Amazon Prime members are in line to get big discounts on seafood at Whole Foods Market stores.
Earlier this week, Whole Foods rolled out a new loyalty program that offers 10 percent off hundreds of sale items to Prime customers. Rotating weekly specials, including USD 10.00 (EUR 8.48) per pound off wild halibut steaks, are also being offered to Prime members.
Prime discounts are currently available at Amazon’s Florida stores, and will roll out to all other Whole Foods locations starting this summer.
As Whole Foods lowers prices on fresh seafood, other national grocery chains will also lower prices, ultimately providing a better value for seafood shoppers, according to Steven Johnson, a grocerant guru at consultancy FoodService Solutions.
“The ability to sell fresh seafood at extremely competitive prices will drive customer migration to Whole Foods and an increase in seafood sales nationally,” Johnson told SeafoodSource.
Other food retailers should be concerned about Amazon and Whole Foods’ latest price cuts, Johnson said.
“Combine price with messaging, and they will be a very powerful food competitive retailer moving forward,” he said.
With more than 100 million Prime members, Amazon is a “marketing powerhouse,” Johnson said.
“Just think about the strength of the branded message that 100 million people are paying for. Other than Costco, there is no other subscription food retailer anywhere near those numbers,” he said.
In fact, Amazon is set to overtake match Walmart’s gross merchandise volume by 2020 or 2021, according to new data from J.P. Morgan.
"Amazon is the second-largest U.S. retailer and fastest growing at scale," analyst Christopher Horvers told Business Insider. ”We believe key drivers of Amazon's share gains include: the Prime ecosystem; endless aisle driven by third-party seller expansion; outsized growth in large, underpenetrated categories; and removing friction and moving closer to customers.”
For its part, Walmart’s sales grew 3.5 percent to USD 318.5 billion (EUR 270 billion) for fiscal year 2017. But Amazon’s GMV surged 31 percent from USD 141 billion (EUR 120 billion) in 2016 to USD 186 billion (EUR 158 billion) in 2017, Business Insider reported.
Meanwhile, Amazon’s fresh grocery delivery service, AmazonFresh, will no longer sell goods from third-party vendors as part of its Local Market Seller program, according to Business Insider.
Instead, Amazon will buy more products wholesale, the retailer said in an email to vendors. Amazon began scaling back AmazonFresh in some markets late last year.
“The move to drop local vendors makes plenty of sense as Amazon seeks more efficiency and centralized control in the increasingly competitive grocery delivery space,” Business Insider said.
The impact of the move on fresh and frozen seafood suppliers remains to be seen, Johnson said.
“Amazon is too efficient of an operation to need or want third party sellers,” Johnson said. “After all, they started out selling books – eliminating the middleman. No one could be surprised by this move.”
Photo courtesy of Whole Foods
