We all know the lament of the office worker: there’s just no time to take on the demands of bringing lunch to work every day, especially if it’s a healthy lunch. One big deal today could change that: Amazon announced today that it is buying the upscale grocery chain Whole Foods in a deal worth about $13.7 billion.
Amazon’s e-commerce empire has already forever changed how we shop online and now it wants to extend its reach into how we eat.
Sometimes nicknamed “Whole Paycheck” by laypersons unwilling to pay $93 for truffles, Whole Foods has been struggling to compete with competitors like Costco.
Whole Foods, while notably expensive, faced a paradoxical problem of its own popularity, which was easily imitated. Sometimes nicknamed “Whole Paycheck” by laypersons unwilling to pay $93 for truffles, Whole Foods has been struggling to compete with competitors like Costco, Trader Joe’s and Walmart as they also began offering organic foods, but at cheaper prices.
Amazon wants to be part of that $100 billion habit. With this deal, Amazon is hoping that more people will associate Amazon.com with being their one-stop destination for all shopping needs — even for fresh vegetables.
Of course, Amazon is known for technology, so where does that come in? Simply this: Through Amazon’s wide range of technology products, Whole Foods customers may be part of a new future where you can plan your grocery list through a voice assistant or a barcode scanner. Imagine how useful that will be for shopping from work, or while commuting.
If we want to see more on how Amazon could change how you shop at Whole Foods, we can look towards its Amazon Go prototype. In this concept store, Amazon experimented with making cashiers and checkout lines obsolete by using sensors to track what foods you buy, so you can just pick up your food and go.
Amazon already launched its own grocery delivery business, the AmazonFresh subscription service, in its Seattle home base in 2007, with some success. But it hasn’t yet had nationwide success with online grocery shopping because perishable foods come with unique efficiency challenges that the company’s advanced logistics technology doesn’t account for.
Why fresh food is so hard to get
Fresh food, with its lumps and bumps, defies many types of automation. An MIT paper memorably recounted how Amazon production workers were forced to discard extra bananas because AmazonFresh market’s definition of a banana bunch was exactly five bananas. About a third of bananas that could be sold were wasted that way.
Amazon experimented with making cashiers and checkout lines obsolete by using sensors to track what foods you buy, so you can just pick up your food and go.
But through its new acquisition, Amazon is signaling that its found the way to getting you that bunch of bananas quicker and more effectively: by taking over your local brick-and-mortar store.
Through Whole Foods’ 460 stores in the U.S., Canada, and the U.K., Amazon gains new footholds into its food distribution network, making the logistics and coordination of delivering fresh foods to your doorstep more possible. For Whole Foods, the acquisition comes at a much-needed time.
Amazon disrupted the retail industry after it conditioned us to the convenience of same-day home delivery service. By taking over our Whole Foods grocery carts, Amazon is projecting a future where customers could be telling their Amazon personal assistants, “Alexa, deliver my conflict-free lettuce in five minutes” — and not have that be a joke.
And that makes your sad desk lunch just a little less sad — although it will still leave you at least $1000 poorer, if not a little more. Many people will decide that’s a price they’re willing to pay for convenience.
Jeff Bezos: "Alexa, buy me something from Whole Foods."
Alexa: "Sure, Jeff. Buying Whole Foods now."
Jeff Bezos: "WHA- ahh go ahead." pic.twitter.com/GuJ2jlAiuU
— JESAL (@JesalTV) June 16, 2017