Dive Brief:

  • Amazon will cutting prices on hundreds of products at Whole Foods beginning Midweek, according to a printing release from the grocer . This is the 3rd round of price cuts since Amazon first acquired Whole Foods in 2017, and co-ordinate to a Wall Street Journal report they will last through the end of this year.
  • Whole Foods will reduce prices by an average of xx% on select items throughout the store, with an emphasis on summit-of-flavour produce, the company said. Big yellowish mangos will exist priced at $1 each, a 12-ounce carton of mixed-medley scarlet tomatoes will be priced at $3.49 and a bunch of organic rainbow chard will be $1.99.
  • Prime members will receive double the weekly discounts, with more than 300 Prime deals expected in the adjacent few months. In April, Prime number members will encounter deals such as 35% off sustainable, wild-caught halibut fillets, a $2 cost drop to $two.99 per pound on organic strawberries and 20% off sandwiches and wraps. Get-go Wednesday and lasting until the end of the month, Whole Foods will as well offering $x off any order of $20 or more to customers who sign up for Prime number.

Dive Insight:

Afterwards its conquering of Whole Foods in 2017, Amazon introduced a sweeping lineup of lower prices on Whole Foods products. From Whole Trade bananas and organic avocados to creature-welfare-rated ground beefiness and almond butter, grocery staples were discounted by as much every bit 43%, according to Bloomberg.

The low prices didn't concluding long, with some shooting support merely a couple months afterwards. Since then, Whole Foods and Amazon have received criticism for their subpar efforts to further slash prices. The companies accept touted weekly specials and lower prices on hundreds of products, but a September assay from Gordon Haskett showed that a basket of Whole Foods groceries was simply $1.l cheaper than before the acquisition. Last month, The Wall Street Journal noted  that Whole Foods prices had increased again, with the visitor citing aggrandizement costs.

Amazon Prime number members have fared better when it comes to the cost of Whole Foods groceries, with an actress 10% off sale items and member-only discounts on a variety of products. Amazon is pumping up its Prime number enticements with the $10-off deal — a reminder of how heavily invested Amazon is in driving its core membership base of operations to stores and bringing more shoppers into its Prime ecosystem.

So far, research shows the integration of Prime hasn't been as stiff as many predicted. Co-ordinate to a recent survey from Wolfe Inquiry, simply 5% of Prime number members shop at Whole Foods several times a month, and 42% of Prime members say they never shop at Whole Foods.

Amazon's declaration that it will launch its own grocery chain overshadows its efforts with Whole Foods to some degree, making information technology hard not to wonder what the east-tailer's ultimate plans are with the natural grocer. Is it a testing ground for pricing at its new grocery store, or a way to identify what products are most popular? The visitor is also mining valuable shopper data from Whole Foods customers, and could be using that information to aid shape its new offer.

Strengthening its brick-and-mortar footprint, whether through Whole Foods or its new grocery chain, is imperative for Amazon. Wolfe Research constitute that online purchasing penetration may be reaching capacity, with 44% of people reporting there were no categories in which they planned to increase online spending next year. This is particularly challenging for online food sales, which accept not gained major traction compared to other retail industries , and could signify future challenges for Amazon's online grocery offerings.

Whole Foods has long struggled with its high-priced reputation, which doesn't necessarily align with Amazon's low-toll offerings across grocery and numerous other categories. If Amazon can consistently keep Whole Foods pricing in line with the discounts information technology offers through Prime and on Amazon.com, it could start to build more customer loyalty.

The latest round of toll cuts could help concenter more than shoppers who avoided "Whole Paycheck" prices, especially if they have a Prime membership. But with Amazon'south shaky track record on holding prices down at Whole Foods, information technology could be tough to convince customers to make the switch.