Whole Foods acquisition
Tom Dougherty, CEO – Stealing Share
28 June 2017
Whole Foods acquisition better defines Amazon
For $13.7 billion, Amazon once again changes the online retailing game. With its acquisition of Whole Foods, Amazon is no longer just an online retailer. In fact, it hasn’t been one for sometime now. This Whole Foods acquisition is just another reminder of that.
People error when they say that this is Amazon’s foray into brick and mortar. This is not about owning brick and mortar. This is about owning distribution and warehousing. It just so happens that these locations are also retail establishments.
Amazon is a logistics company. It just happens to own the goods it is also transporting to its customers.
“Clearly, Amazon is asking itself, ‘What other products and services can we deliver to our customers?’ That is a very different question than, ‘What products and services can we sell?'”
Amazon once defined itself about products and pricing. It has just about everything at usually cheaper prices than anywhere else. But Amazon changed as online retailing did too. It shifted to something more than everything cheap.
The Whole Foods acquisition is about Amazon’s logistics
Look at some of the recent moves by Amazon. Neither Alexa, the voice of the Amazon’s personal assistant, Echo, or the Whole Foods acquisition is about everything cheap. Whole Foods is certainly not cheap. Echo’s function is more than an appliance that orders stuff.
Rather, the Echo and Whole Foods strategies are about bringing goods, services and information to the customer. The very definition of logistics. Even its cloud-based services are really about delivering information.
Sure, the Whole Foods acquisition will allow Amazon to offer more products. However, offering new products and delivering them quickly is the real consumer benefit.
Clearly, Amazon is asking itself, “What other products and services can we deliver to our customers?” That is a very different question than, “What products and services can we sell?”
Amazon’s business success results from getting those goods to its customers quicker and more cheaply (free).
Amazon’s brand success has come because it has always tried to show consumers a better way, often before consumers even knew a better way existed.
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