Amazon's Grocery Push Keeps Stumbling After Whole Foods Purchase (bloomberg.com)

Bloomberg reports that Amazon is struggling in the $840 billion grocery market, more than a year after it spoked the industry with the $13.7 billion acquisition of Whole Foods last year. "The number of Amazon Prime members who shop for groceries at least once a month declined in 2018 compared with 2017, according to the results of an annual consumer survey released Wednesday by UBS analysts," the report says. "The drop was surprising given the company's Whole Foods investment and expansion of two hour delivery service Prime Now, the analysts wrote in a note to investors." From the report: A separate study by research firm Brick Meets Click found that households using grocery delivery and pickup services from physical retailers spend about $200 per month and place orders more frequently than Amazon grocery shoppers, who spend $74 a month. The number of households with access to online grocery delivery and pickup options will reach 90 percent next year, up from 69 percent in 2017, thanks to big investments by food retailers of all sizes, the report states.

Comments

Re:how

[Actually, I do RTFA]

Most major grocery stores have a very thin margin, 2-3%. Whole Foods probably has a better margin. But they have a hefty delivery fee if you order under $35. So, that's probably just over a dollar. If they plan the delivery path well, that's probably right around the cost to deliver (esp. since they include a tip by default and the drivers are independent contractors).

Whole Paycheck

[ugen]

Whole Paycheck, as we know it, is still as overpriced as ever. While they do have some products not available elsewhere, where they have exactly the same products to compare, their prices are routinely 30% above other stores.

Even a reasonably paid professional will find it hard to justify WF price premium (particularly when excellent groceries are available at several competing chains, esp. in our area thanks to "ethnic" chains moving in). As long as WF will remain priced as it is, I don't see it making any gains.

Anecdotally, I moved from buying 50% of my groceries at WF 10 years ago to virtually nothing (the only thing I buy there nowadays is bread)

Re:I need to feel those melons

[rtb61]

Which is why Amazon is struggling, there is a lot of competition in that market and once you are happy with your store, you tend to stick with it until they do something wrong. For me to change from Coles, it took those idiots, purposefully running down the number of check out chicks, so that you had to waitt 10 to 15 minutes to get served even in the middle of the day or use the self service check out. Well, the other alternative was to go to the competitors, seriously you want to give me shite service on purpose to force me to do what you want me to do, well, dropped going to their stores and ordered deliveries from somewhere else, that 20 odd minutes of forced waiting will cost 2 years of custom, minimum, already at the six month mark.

Look Amazon has a pretty shitty rep, abuse staff and staff are customers as are the people who know that staff and well, supermarkets of all sorts of brands are everywhere. So a reasonable, reliable job and you keep custom, fail and you lose them until their next supplier fails. Would I order groceries from Amazon, no until my current supplier screws up, why bother, the prices will be much of a muchness and it will be down to service and reliability. Amazon is about cheap and nothing else, they have nothing to sell in the grocery market, buy cheap, sell cheap is who they are and probably quality has taken a nose dive at whole foods in pursuit of cheap.

Keep in mind, people often chat with staff at grocery stores, it's a more personal shopping space, driving them to focus on store stuff and ignore customers, is guaranteed to lose you customers in that working space. Can Amazon with it's corporate nature ever do groceries effectively, probably not, it has no idea about person to person customer service.