Amazon’s acquisition of Whole Foods Market could help push more shoppers to ecommerce

Amazon/Whole Foods merger could push more shoppers to ecommerce

Only 9% of US consumers currently buy groceries online, but the Amazon/Whole Foods deal already is generating incremental interest in buying egroceries, according to a new consumer survey.

A survey of 1,000 US consumers conducted by GfK found that 23% of shoppers view the deal positively, which is more than twice as many as the 11% who saw the deal as a negative.

“Now, 23% may not seem like a big number – but in our data, only 14% of US consumers shopped at Whole Foods in the past month, and … just 9% are buying egroceries – so the deal is already adding incremental interest,” according to the report.

“Those positive feelings are amplified among Whole Food shoppers, with almost four-in-ten (38%) finding the combination to be positive,” and 31% of Amazon shoppers finding it positive, the report adds, noting, “those who shop with both retailers are even more upbeat (43%).”

Much of this elation can be attributed to the strong brand equity of both Whole Foods Market and Amazon, but it also stems from consumer hopes that the deal will create a true omni-channel grocery experience that offers multiple benefits, according to the study.

Specifically, it found of those shoppers who are positive about the acquisition, 42% hope it means they will get free delivery if they are Prime members, 34% hope it means more tech in-store to streamline shopping, 25% hope the quality of fresh foods available online will improve and 25% hope the deal means they will now be able to get Whole Foods specific products online.

Sales likely will come, but in time

But will these hopes translate to sales? The survey suggests yes, but also that it might take a while.

It found only 9% of respondents said they are very or extremely likely to sign up for a service through Amazon or Whole Foods – which is the same percentage of those who already shop for groceries online and would suggest no apparent incremental lift.

But, the researchers were quick to point out that even if consumers are not yet willing to commit to a grocery delivery service, “latent interest seems to exist” in the 22% of respondents who said they are somewhat likely to sign up.

“All in all,” the report notes, this translates to “almost one-third of consumers are possibly in play.”

In addition, the 48% of consumers who are neutral on the deal could represent a second wave of users once the full meaning of the arrangement sorts out, the report suggests.

The deal also offers upside for both brands individually, according to the survey.

For example, more than three quarters of those who felt positive about the arrangement do not currently shop at Whole foods, which could translate into more shoppers for the grocery. Similarly, 28% of those who felt good about the acquisition did not make a purchase from Amazon in the past month, which represents a healthy amount of potential new or returning consumers to the online retailer.

What all this boils down to, according to the survey, is that many consumers are taking a wait and see approach to online grocery shopping, but “there is certainly some interest” and that Amazon/Whole  Foods alone may not be enough to dominate the egrocery landscape.

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