In the ever evolving battleground known as the Omnichannel Wars Amazon has dropped what could be the equivalent of an atom bomb in it's agreement to purchase Whole Foods. One article from Chain Store Age (http://www.chainstoreage.com/article/amazon-buying-whole-foods-market?tp=i-H43-Q5S-3mq-5klKX-1u-14Qs-1c-5kr1Q-PxptV&utm_campaign=BreakNew&utm_source=Experian&utm_medium=email&cid=14560&mid=85026709) summed it up nicely stating;
Jeff Bezos is a master of PR," said Kelly Sayre, analyst, retail/CPG, IHL Group. "He is brilliant at timing announcements for coopting the news cycle. The drone story and Amazon Go stories of the last two years just happened to coincide with Black Friday weekend. It is not lost on us as analysts that this announcement just happens to coincide with the day(s) that Lidl opened its first stores in the U.S., and Walmart bought Bonobos (http://www.chainstoreage.com/article/walmart-acquire-bonobos?tp=i-H43-Q5S-3ms-5kyiv-1u-14Qs-1c-5l4Q8-11fZ5s&utm_campaign=BreakNew&utm_source=Experian&utm_medium=email&cid=14562&mid=85078193). And it came just after Aldi announced a 3.4 billion level of investment in expanding in the U.S."
So adding onto that the Bezos historically looks at the long-game what role does Whole Foods play in the Amazon universe? Is this about Amazon getting a profitable business with high margins while leveraging Amazon's buying power and logistics to drive penetration and scale for Whole Foods? It also now puts Amazon squarely in an even broader competitive set that includes the likes of Acme, Giant, Publix and others that are most likely not looking fondly at the growing list of retail brethren that have been crushed under the Amazon wheels-o-retail and are shuddering in anticipation of trying to figure out how to compete against the likes of Amazon.
Back in the day Amazon used to sell books but it also had a strategic approach to broaden it's portfolio. That was to establish a seemingly non-hostile relationship with brick & mortar retailers like Toys 'R Us (see bankruptcy), Borders Books..etc. The goal? To get in front of the customer interaction. Amazon sold itself as an expert in the digital space and allowed for cost efficiencies (i.e: not having to build out a web-site or deal with the head-ache of how to fulfill product or the logistics on from where) from the brick and mortar company to focus on what it did best (selling in a physical store) while letting Amazon manage it's digital footprint which was a low volume mix relative to the traffic that was walking into the brick & mortar stores on a daily basis. But, as we all know now, by insinuating itself in the path to purchase and putting its brand in-between the customer and the brick & mortar brand Amazon was able to create a wedge that has grown
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