Freedonia Analyst Weighs in on Amazon's Acquisition of Whole Foods

CLEVELAND, June 16, 2017 /PRNewswire/ -- Today, Amazon.com, Inc. announced its agreement to acquire Whole Foods Market, a deal valued at more than $13 billion.  The transaction is expected in the 2^nd half of 2017.

The strategic possibilities that stem from the acquisition abound.  While online grocery sales have grown nearly fivefold in the US over the last decade, they still account for less than 1% of overall sales. Groceries remain one of the underrealized segments of e-commerce, especially when compared to consumer electronics and media sales. 

Analyst Mike Richardson discusses the acquisition:  "With Whole Foods as part of the broader Amazon footprint, they're into the grocery segment in a big way.  If online grocery shopping becomes more mainstream, it's hard to imagine that Amazon won't be out in front of that wave.  And if it doesn't, Whole Foods is a good vehicle through which to compete in the brick and mortar grocery world -- Whole Foods' shoppers are generally younger and more affluent than the typical shopper.  Amazon's expertise in e-commerce will combine with Whole Foods' reputation for quality grocery items, which will put the combined business in a good position to compete in a more robust online grocery segment, a more traditional store-bound grocery industry, or -- perhaps most likely -- something in-between.  Amazon has already experimented with physical retail, including food, incorporating some of the technological innovations of its e-commerce activities."   

The acquisition of Whole Foods could reshape Amazon's competitive position in both traditional retail and e-commerce, and will almost certainly have a significant impact on the US retail landscape, and -- less directly -- other industries, such as packaging and logistics.  The Freedonia Group and MarketResearch.com have numerous reports related to food retailing and e-commerce, including on a number of packaging topics. 

Related titles include:

• Retail E-Commerce Packaging (Industry Study)
• E-Commerce: United States (Focus Report)

About The Freedonia Group – The Freedonia Group, a division of MarketResearch.com, is a leading international industrial research company publishing more than 100 studies annually. Since 1985 we have provided research to customers ranging in size from global conglomerates to one-person consulting firms. More than 90% of the industrial companies in the Fortune 500 use Freedonia Group research to help with their strategic planning. Each study includes product and market analyses and forecasts, in-depth discussions of important industry trends, and market share information. Studies can be purchased at www.freedoniagroup.com and are also available on www.marketresearch.com and www.profound.com.

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SOURCE The Freedonia Group