- Whole Foods’ CEO and co-founder John Mackey's influence over the chain has diminished significantly since Amazon took over. CNBC obtained a copy of an organization chart, which shows that CEO Jeff Bezos is loading the company with Amazon executives who “can weave the grocery chain’s 484 stores into his broader vision for the future of physical retail."
- Rather than reporting directly to Jeff Wilke, CEO of Amazon's worldwide consumer business, as many expected, Mackey now reports to Steve Kessel, who oversees all physical store operations. Mackey is also sharing oversight duties with two Amazon executives, Rosanna Godden and Heather Dystrup-Chiang.
- During a company-wide town hall meeting last week, Mackey said the two companies have had “many, many” clashes and noted that he was “not afraid to get fired.” More than a dozen Whole Foods executives have left since the acquisition last year.
There may be trouble in paradise. A year after Mackey joked that Whole Foods was with Amazon “until death do us part,” he stated just last week that he isn’t afraid to get fired or “speak truth to power when it’s necessary to do so,” in reference to his boss, Amazon.
The loquacious Whole Foods co-founder’s comments are not out of character, but they do seem to indicate an uncomfortable truth – that his influence on his company seems to be waning. Judging by the mass exodus of executives in the past year, Whole Foods’ influence on Whole Foods seems to be waning as well.
The two companies have had a culture clash since the beginning. Amazon's culture is often described as productivity-driven, aggressive and internally competitive, but also innovative, tough and hardworking. Whole Foods, on the other hand, is the idealist; it is consumed with a "higher purpose" to provide good, high-quality products, and takes great pride in caring for communities.
But the acquisition provided a way for Amazon to find its footing in the highly competitive grocery space, leveraging a company that had significant infrastructure in place and nearly 40 years of expertise. Whole Foods allowed the e-commerce giant to quickly get up to speed in the $800 billion sector, which has caused some analysts to predict Amazon’s sales will match Walmart’s as soon as 2021.
Amazon’s transformation of Whole Foods has been swift. It has cut prices, offered discounts for Prime customers, and begun selling Echo devices and other gadgets in stores. With Amazon’s executives stacked into place, expect the transformations to not only continue, but to accelerate. Although Whole Foods began centralizing its buying operations before Amazon bought it, the e-tailer certainly doesn't disagree with the practice, and may increase the chain's focus on scalable and national brand products. And though it has said it won't apply its cashier-less Amazon Go technology to Whole Foods stores, expect other nifty tech integrations to hit the front ends and aisles over the coming months.
It's no surprise that Mackey has been so vocal — this is the company he built, after all. But Amazon has retail domination in mind, which is far from personal. With a full year of grocery experience under its belt, Amazon may not need Mackey’s expertise – or distractions – much longer.