You’ve heard the alternate version of the Golden Rule, I’m sure; He who has the gold makes the rules. That has, fortunately or unfortunately depending on your perspective, always been true.
This week marked the beginning of a new era in food retailing as Amazon began operating Whole Foods Markets on Monday. And Amazon definitely has the chops to remake the rules on how consumers buy their groceries.
Whole Foods Market stores began offering lower prices this week on some of their best-selling grocery lines and Amazon said it will embark on a plan to have Amazon Prime take over the Whole Foods loyalty program with the goal of providing special savings and in-store benefits for Prime shoppers, reports Supermarket News, a BEEF sister publication.
Supermarket News reports those price reductions were as much as 43% on some items, according to an in-store check it did on Monday. Amazon didn’t specify the total number of grocery items it would use to put the Whole Foods reputation of “Whole paycheck” to rest, but it did mention that animal-welfare rated 85% lean ground beef would be included in the mix.
What’s more, Whole Foods private label products will be available through Amazon.com, AmnazonFresh, Prime Pantry and Prime now. Lockers will be available in select Whole Foods Market stores where customers can have products shipped from Amazon.com to their local Whole Foods Market store for pick up or can send returns back to Amazon.
While buying online and having products shipped to a brick-and-mortar store is not new, the integration that the Amazon-Whole Foods marriage will entail takes the concept to a whole new level. Likewise, ordering online and having groceries delivered to your home isn’t new. Walmart, for example, is using Uber in some cities to make deliveries.
Remember when Amazon experimented with using drones to deliver packages? Expect Amazon to take the home delivery concept to a whole new level as well.
Set aside for a minute the trend toward natural, organic, animal welfare, et. al. and focus only on what Amazon will do to traditional retailing. It’s likely that many ranchers won’t see it in their stores, because ranchers live where cows outnumber people. But in the major urban centers, where people are packed in tighter than sardines in mustard sauce (my personal favorite), traditional retailers may well become a victim of change and a relic of history.
What changes will the beef business need to make to adjust to that new reality? I don’t know. So the question is this: Is the beef business ready to adapt to a new reality where Amazon, which has the gold, makes the rules on how consumers buy our product?