Whole Foods sees 25 percent jump in shoppers after Amazon cuts

September 11, 2017

Amazon.com Inc.’s splashy takeover of Whole Foods, complete with deep price cuts, did more than bring a surge of publicity to the chain: It boosted customer traffic by 25 percent.

That’s the finding of Foursquare Labs Inc., which compiled location information during the first two days after Amazon completed its acquisition of the grocer. The data, culled from shoppers’ mobile devices, was compared with the same period a week earlier.

Amazon acquired the upscale chain last month for $13.7 billion, a move that has brought turmoil to the supermarket industry and sent shares of grocery rivals tumbling. The same day it completed the acquisition, the e-commerce giant cut prices by as much as 43 percent on a range of items. Organic fuji apples were marked down to $1.99 a pound from $3.49 a pound, for instance. Organic avocados dropped to $1.99 each from $2.79.

Whole Foods has four stores in Indiana, including locations at 1300 E. 86th St. in Indianapolis and 14598 Clay Terrace Blvd. in Carmel. The other state locations are in Mishawaka and Schererville. The grocer is expected to open another local store later this year on the ground floor of the 360 Market Tower apartment project on the northeast corner of Alabama and Market streets.

The traffic data is an optimistic sign that Amazon can succeed in the brick-and-mortar world. In some areas, the jump in customers was dramatic. At stores in Chicago, 35 percent more shoppers visited Whole Foods stores, Foursquare found.

Whole Foods should help Amazon build a distribution network, letting the company deliver more food to online shoppers. But the e-commerce seller still faces plenty of challenges. Handling fresh food is a tricky and expensive proposition that has vexed Amazon for a decade.

And even with Whole Foods, Amazon remains a small player in the grocery business. It controls less than 2 percent of an $800 billion market dominated by Wal-Mart Stores Inc., Kroger Co. and Albertsons Cos.

Whole Foods also had struggled in the years leading up to the merger, hurt by its organic produce becoming less of a novelty. Kroger and Wal-Mart have aggressively expanded their organic offerings, often at lower prices.


Recent Articles by Bloomberg News

Comments powered by Disqus