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This is a note from the E-commerce coverage of Business Insider Intelligence. Click here to find out more.
Business Insider Intelligence
Most Amazon Prime subscribers plan to shop online at Prime Day – but not at Whole Foods. In an informal survey of Business Insider readers, Business Insider Intelligence found that 78 percent of those surveyed with premium subscriptions plan to buy Amazon on the first day, while 25 percent plan to shop at Whole. Foods. The data is not representative of the general population, as Business Insider readers tend to be younger, male and techie. But we believe this suggests that Amazon's efforts to promote Prime Day for Whole Foods will succeed in creating traffic for the grocer, although Amazon could do more to develop its performance in the years to come.
Prime Day is expected to make record profits in the Amazon, but its work with Whole Foods is still in its infancy
- A longer lead time and larger rebates will attract a record number of customers on Amazon. Amazon has extended Prime Day to 36 hours this year, up from 30 in 2017, giving consumers more time to shop. Meanwhile, the company plans to offer 50% additional Spotlight Deals, its "biggest discounts" on popular brands and products, and the introduction of Prime Day launches, which will see brands offering exclusive and special items for the event. with more attractive offers. We believe these efforts will make this year's Prime Day the biggest ever.
- But fewer buyers plan to act on Prime Day offers at Whole Foods. Amazon has gone to great lengths to promote Prime Day to Whole Foods, offering consumers a $ 10 Amazon credit offer for subscribers who spend $ 10 on Whole Foods. However, only 25% of respondents say that they are likely to take advantage of Amazon's Whole Foods promotions on Prime Day. This low interest could be explained by the fact that not all Premium subscribers live near a Whole Foods store and that this requires a trip to a store – a commitment of time and commitment. more effort than online shopping.
Attracting the first subscribers to Whole Foods on the first day is a great opportunity for Amazon, and the first iteration seems to be off to a good start. Less than 20% of the core members are Whole Foods buyers, a source told CNBC. But since 25% of those surveyed at Prime expect to shop at Prime Day, the event could bring new premium subscribers to the grocery store, although it's unlikely that all respondents would have given their plans. The addition of new Whole Foods customers is a key step to improve its position in the US mbad market grocery industry. IMF and Nielsen estimate that online and offline grocery sales will reach $ 641 billion in 2017. This means that Whole Foods accounts for about 2.5% of the United States. market of food and groceries. By context, Walmart, which ranks first, accounts for about 15% of the food market.
Here's how we think Amazon can attract more consumers to Whole Foods at Prime Day in the future:
- Amazon is expected to promote the grocer's business on Amazon.com. This year, Amazon has listed Prime Day offers available at Whole Foods in press releases and in the Whole Foods Market app. For upcoming events, the company should list Prime Day grocery offerings on Amazon.com in advance and during the event, allowing the e-tailer to educate those millions of customers who are attracted to the event each year. Marketing promotions in this way could also attract leading members who do not generally shop at Whole Foods, and therefore would not be aware of offers.
- It should also provide greater incentives and cross sales from Amazon.com. Subscribers who do not shop at Whole Foods may not want to make a trip to the grocery store the first day because of the level of effort required. Amazon has already helped to solve this problem by organizing numerous Prime Day offers from July 11th to the end of Prime Day, giving more time to customers, and offering the $ 10 credit for $ 10 spent to Whole Foods. The company should also consider offering prime customers who spend $ 10 on Amazon.com a $ 10 credit for Whole Foods that can be used in the following month Prime Day. This would not only give consumers a reason to go on a trip, but let them do their own schedule.
To learn more about Amazon's coverage by Business Insider Intelligence and the latest trends, data, and transformational ideas affecting e-commerce, read the report on Amazon's competitive advantages in four parts. .
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