Amazon outlines Whole Foods integration plans

Amazon's $13.7 billion takeover of the upscale market closes on Monday.
Written by Natalie Gagliordi, Contributor

Amazon has finally revealed details about how it plans to integrate with Whole Foods after its $13.7 billion takeover of the upscale market closes on Monday.

Most of the early initiatives look like an effort to strip away the "Whole Paycheck" nickname that Whole Foods has earned over the years. For instance, Amazon said it will offer reduced prices starting Monday on a selection of organic grocery items within Whole Foods stores, including avocados, eggs, salmon and tilapia, ground beef, almond butter and apples.

Amazon calls the price drop a "down payment" on its vision of making "high-quality, natural and organic food affordable for everyone."

Eventually, Amazon Prime will become the Whole Foods loyalty program once technology teams can integrate Prime membership data into the Whole Foods point-of-sale system. When the work is complete, Prime members will receive exclusive discounts on in-store items.

Over time, Amazon said it will work to revamp Whole Foods' merchandising and logistics operations to further reduce prices for Whole Foods customers. Amazon will also install Amazon Lockers in select Whole Foods locations, allowing shoppers to pick up and return online orders from Amazon.com.

Additionally, Whole Foods' private-label products will be available through Amazon.com, AmazonFresh, Prime Pantry and Prime Now. The ecommerce giant made no mention of potential grocery delivery services, but it's definitely laying the groundwork.

"This is just the beginning," Amazon said in a press release. "Amazon and Whole Foods Market plan to offer more in-store benefits and lower prices for customers over time as the two companies integrate logistics and point-of-sale and merchandising systems."

Amazon reiterated that John Mackey will remain as Whole Foods' CEO and that its headquarters will stay in Austin. And while many have predicted that Amazon could eventually automate Whole Foods with cashier-less store formats, the company has stated that it has no plans to replace Whole Foods cashiers with Amazon Go operations.

The integration plans come just a day after the Federal Trade Commission voted to approve Amazon's acquisition of the grocery chain. Whole Foods Market's shareholders also approved the merger on Wednesday.


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