Report: 62% of shoppers more likely to visit Whole Foods after Amazon acquisition
- Sixty-two percent of shoppers are more likely to shop at Whole Foods after the Amazon acquisition and 84% have positive feelings about the merger, according to a report by ChargeItSpot. The cell phone charging station provider polled 900 shoppers from across the country for the study.
- When asked what Amazon should add or change at Whole Foods stores, the top three responses were cashier-free checkout (31%), lower prices (30%) and in-store pickup for Amazon purchases (19%).
- “When Amazon announced they would be expanding into the grocery space, shoppers were interested to see what new features would be implemented in these stores,” ChargeItSpot CEO Douglas Baldasare said in the report. “Our survey found that shoppers want the Amazon-Whole Foods merger to upgrade the grocery store experience with additions of useful technology.”
It's important to note that this is not likely a completely representative sample — considering the source is an in-store charging station provider — but the results are still good news for Whole Foods and Amazon. Perhaps most interesting is the fact that more consumers wanted to see the natural and organic retailer adopt cashier-free checkout than lower pricing, despite widespread consensus that Whole Foods' costly products were what led to its struggles.
These results also reflect strong shopper demand for convenience, a trend that has been sweeping the grocery industry. Retailers have struggled to balance consumer desire for fast checkouts with simultaneous demand for premium grocery experiences. Now that Whole Foods is coming under Amazon's ownership, expectation for top-line convenience will only grow.
The e-commerce giant can certainly deliver on this demand. Since the announcement of the acquisition, many analysts have speculated that Amazon could use well-positioned Whole Foods locations as distribution centers for non-grocery Amazon products. This would be a welcome integration, as research shows that 62% of Whole Foods shoppers are Amazon Prime members.
The 62% of shoppers who said they are more likely to shop at Whole Foods since the acquisition announcement reflects the power of the Amazon brand — something arguably stronger than Whole Foods' reputation, which lost some of its luster as other grocery chains began to offer comparable shopping experiences for less.
Still, perhaps the biggest takeaway from the study is this: competing grocers are going to have to up their game.
"If you’re a grocer, you have a couple of choices now in front of you," Steve Matthesen, president and CEO of Acosta, told Food Dive in a recent interview. "You can try to fight fire with fire and figure out how to get stronger in e-commerce. That’s both expensive and there aren’t all that many other candidates — Wal-Mart’s move with Jet took out one of the clearest alternatives to Amazon. The other alternative for grocers is to reinvest in their stores and get closer to customers and really drive value."
Matthesen said that something that often gets lost in the e-commerce discussion is the fact that the grocery supply chain is highly efficient. Grocers don't make a lot of margins, but they move a lot of volume fairly quickly.
However, Matthesen cautions grocers from diving headlong into the e-commerce race, saying brick-and-mortar stores still drive 98% of grocery business today.
"If you create the right in-store experience and loyalty, you can translate that into the online piece," he said. "People’s online preferences in this space are not yet established. Amazon has a very strong presence and does a lot of things really well, but if you’re my local grocer and I have a long-term history with you and trust in what you do, I may well give you my online business too, and for delivery as well."
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