Amazon buying Whole Foods for $13.7 billion
- Author: Zachary Reyes Jun 21, 2017,
Jun 21, 2017, 21:49
It announced Friday that it's buying online men's clothing retailer Bonobos for $310 million in cash, following a string of online acquisitions including ModCloth and Moosejaw.
Investors like the deal and think it will be good for the online retail giant, which has been expanding its grocery offerings. Whole Foods, a pioneer in natural and organic products, has 456 stores, which young, high-end shoppers flock to. At some of the Whole Foods 365 locations, the grocer's discounted brand, consumers can use iPads to order food or find a bottle of wine. The shift started within minutes of the announcement online retailer Amazon would taking over the grocery chain Whole Foods.
And this headline from Business Insider helps explain it: Amazon is acquiring Whole Foods - and Walmart, Target, and Kroger should be terrified. "If shoppers are going to allow a company, a retailer, to pick their meat, their produce and their seafood, Whole Foods is probably at the top of the list of retailers with the best reputation across the country".
Amazon is already playing with innovative ways to make grocery store runs more convenient.
"Amazon's brutal vision for retail is one where automation replaces good jobs". Amazon's stock shot up on the news.
Kyle Bunch is with R/GA, a marketing, advertising and consulting firm right across from the Whole Foods headquarters.
But despite the Whole Foods acquisition and, by extension, the potential technology Amazon could implement in brick-and-mortar outlets, the company said it now has no plans to automate the jobs of cashiers in Whole Foods stores after the acquisition.
"People tend to do what's easy and clicking on something on Amazon is so easy", Funari said.
Whole Foods has already been reducing prices to try to turn around its worst sales slump since going public in 1992.
SELYUKH: Bernstein is actually a huge fan of both Whole Foods and Amazon.
The acquisition stands as a huge boost for Amazon's strategy to integrate the brick-and-mortar model into its business. While it's competitor Wal-Mart has announced a United States dollars 3.3 Billion for Jet.com past year and UD 310 Million for internet apparel retailer Bonobos, Amazon wanted its customers to visit the store physically to but fruits, vegetables and meat. PCC also has offered delivery through Internet-based delivery service Instacart since November 2015. The deal still has to get approved by shareholders and regulators. It was recently granted a patent for technology that would block shoppers from comparing prices using their mobile devices while they are in stores. Those stores would solve much of Amazon's "last-mile" delivery challenge for fresh groceries - perhaps the top reason it hasn't made a dent in the grocery shopping of the 60 percent of millennials who buy other items from Amazon, he said. At the time, Whole Foods called Instacart its largest partner for online ordering and delivery.