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Amazon has already changed the online shopping game forever and now they attempt to revolutionize grocery stores. But first Amazon must expand Whole Foods’ customer base. Amazon will first try to tempt their own Prime members into doing their grocery shopping at Whole Foods. To do that, Amazon will use the tried-and-true strategy of giving discounts.
Amazon plans to offer a 10% discount on Whole Foods items to Prime members. The 10% discount will even apply to “already discounted” items at Whole Foods stores. The discount is only the first of many perks the e-commerce giant plans to provide. Potential perks include free delivery including 5% cash back for buyers who use the company’s Visa rewards card at Whole Foods and exclusive member deals such as cheaper turkeys around Thanksgiving and discounted flowers around Valentine’s Day. Three months ago, Amazon announced Prime members will receive free two-hour delivery from Whole Foods stores to their homes if they live in approved areas.
About 75% of Whole Foods shoppers are already Amazon Prime members. However, of the 100 million Prime subscribers, only 20% of them actually shop at Whole Foods. Amazon sees the vast economic opportunities if it can steer their Prime members to shop at Whole Foods. Amazon acquired Whole Foods for $13.7 billion in June and immediately lowered prices on some of the most popular items.
Last week, Amazon announced that they are raising the price of a Prime membership from $99 to $119. But there is a way to get one more year at the lower cost, which you can read HERE. The Whole Foods perks will help justify the price hike on Prime memberships. Amazon is up more than 35% in value this year and last week the company’s CEO, Jeff Bezos, saw his already massive net worth skyrocket $12 million in one day.
[CNBC]