Amazon Prime - the online retailer's membership program - will become part of the customer rewards system at Whole Foods, giving Prime members special savings and in-store discounts.
"We're determined to make healthy and organic food affordable for everyone", said Amazon Worldwide Consumer CEO Jeff Wilke in a statement. A Morgan Stanley survey shows about 62% of Whole Foods shoppers are members of Amazon's Prime service, opening the door for cross-selling to entice customers who shop at both to spend more.
Inc. and Whole Foods Market Inc. said Thursday they will lower prices on a range of groceries on Monday to mark the close of Amazon's $13.7 billion acquisition of the organic grocer. Today's grocery executives struggle with two challenges: competing with Walmart on price, and earning loyalty in an ever-more-fractured marketplace.
"Amazon's purchase of Whole Foods will expand its dominance and heighten conflicts of interest", wrote Lina M. Khan, a legal fellow with the Open Markets Program at New America, a consumer watchdog group.
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Amazon will install Amazon Lockers in select Whole Foods locations.
This could mean more of Amazon's brands will be available at Whole Foods, and vice versa.
Whole Foods is known for having high prices, but Amazon plans to change that.
The Seattle giant said it will immediately lower prices on some Whole Foods items - including bananas, eggs, kale, beef, chicken, salmon and avocados - although it didn't specify the size of the price cuts.
Comedian John Oliver, host of HBO's "Last Week Tonight", ridiculed Whole Food's pricing in a memorable 2015 sketch.
With Amazon's acquisition of Whole Foods to be completed on August 28, the company also announced that it would lower prices at the retail stores. For more information, please visit www.WholeFoodsMarket.com or @WholeFoods on Twitter. Actual results could differ materially from those projected or forecast in the forward-looking statements.