On its march to be the only company that sells anything, Amazon has made aggressive moves into smart speakers, video streaming, and a bunch of other areas. One of the company’s current top priorities seems to be groceries, a category that’s traditionally difficult for online retailers. Less than two years after its purchase of Whole Foods, the company is reportedly planning to beef up its portfolio by opening dozens of its own grocery stores.
The move makes sense when you consider what Whole Foods’ well-earned reputation. is. The chain prioritizes organic food, and it won’t sell anything with artificial dyes, sweeteners, or flavors. That means that it costs more to shop there, and that lots of mainstream brands aren’t carried at Whole Foods.
By creating its own more moderately-priced grocery stores, Amazon can target consumers that Whole Foods doesn’t appeal to, people who now shop at places like Kroger and Walmart.
The new stores will carry a wide selection of health and beauty items, including many of the 140 house brands owned and currently sold online by Amazon. They could also carry popular brands whose ingredients don’t meet the somewhat lofty standards set by Whole Foods, where you can’t buy a Diet Coke, for instance.
The internet giant is planning on building dozens of new stores in major cities in the United States. They’ll be set up to fill orders placed online and provide valuable supporting functions for the company’s existing business. In addition to popularizing its in-house brands, the new stores will offer more pickup and delivery points and new sources of data about shoppers.
Currently, Amazon controls just four percent of the $830 billion American grocery market, thanks primarily to Whole Foods. By comparison, industry leader Walmart is at 21 percent. That means there’s lots of room to grow, and if history is any guide Bezos and Company won’t be afraid to move aggressively in order to expand their share of the market.