When Amazon announced its bid for Whole Foods, you could practically hear the screams coming from the C-suites at Kroger and Wal Mart. When a giant like Amazon bites into your market, the chances of survival diminish—and the grocery industry is already famous for thin margins.
Buying physical locations is an interesting strategy because most grocers are doing the exact opposite. They are all working like mad to bring online shopping and unified ecommerce to customers.
More people are buying groceries online. A January 2017 report from the Food Marketing Institute and Nielsen predicts that online groceries will grow five-fold by 2025. The report indicates that 25% of American households buy some groceries online now, up from 19 % in 2014. More than 70% say they will engage in online food shopping within ten years. Of those, 60% expect to spend about a quarter of their food dollars online.
Of course, Amazon is already in the food business. They launched Amazon Fresh in 2016 in 20 cities across the United States as well as in Berlin, London and Tokyo. For $14.99 a month you can order groceries from Amazon Fresh. Amazon Pantry sells non-perishables like cereal, chips, rice and coffee for …read more