Online retail behemoth Amazon is tackling the ultimate IRL retail challenge: It’s opening stand-alone grocery stores. The Wall Street Journal reports that “dozens” of Amazon groceries are planned in the coming years, with the first location slated for Los Angeles debuting “as early as the end of the year.” The news comes just days after the Amazon-owned Whole Foods announced that it would kill its 365 by Whole Foods stores, a “cheaper” iteration of the Whole Foods brand that lasted just two years. WSJ’s sources report that the Amazon grocery concept would be totally separate from Whole Foods, and expand upon the items usually carried by “Whole Paycheck”: Whole Foods famously does not offer any products with artificial ingredients; presumably, shoppers at an Amazon grocery could stock up on all the Coca-Cola and Doritos they want.
Amazon’s foray into the food/grocery space is not surprising. In January 2018, it debuted its cashier-less convenience store, Amazon Go, which sells, among other things, snacks, frozen foods, grab-and-go sandwiches, salads, and Amazon’s own in-house meal kit line. Amazon Fresh Pickup, which allows online shoppers to place grocery orders and pick-up at a store, launched in March 2017; Amazon Fresh, a grocery delivery service, launched a decade prior in 2007. Over the years, Amazon has launched thousands of house brands available for purchase on-site, although as Supermarket News reports, as of 2018, fewer than 2 percent of them were in the food space: The private label Happy Belly offers nuts, trail mixes, and nut butters, while Wickedly Prime is a line of packaged snacks, chips, pastas, and sauces.
Amazon has likely learned a lot from its 2017 acquisition of Whole Foods. Interestingly, the Amazon grocery stores will purportedly have a smaller footprint than the average supermarket — a strategy that 365 by Whole Foods also attempted. In January, it was reported that Whole Foods was eyeing recently shuttered Sears and Kmart locations as potential sites for expansion; today, WSJ reports that Amazon’s groceries could also be targeting vacated Kmarts.
And an Amazon supermarket could represent Jeff Bezos’s final frontier before total world domination: Groceries are one of the few lingering items most American consumers hesitate to purchase online.
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