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Oracle Data Cloud Blog

5 Keys to staying relevant in the age of Amazon and Whole Foods

This week’s guest blog post is contributed by Oracle Data Cloud’s Beth Curran, Director, Retail Strategy and Erica Monteith, Manager, CPG Retail.

As a result of the recent Amazon and Whole Foods merger, changes are popping up in Whole Foods stores around the country.

The Amazon strategy is clear: lower prices to combat the “whole paycheck” image and make shopping at Whole Foods accessible for the average family.

Price reductions ranging from 15 to 40 percent went into effect on August 28, 2017, according to CNBC. This brings Whole Foods more in line—and more competitive—with prices at other retailers.

But beyond changes in traditional grocery categories, Amazon is inserting their own devices into their in-store merchandising strategy by placing Echo and Dot devices on display.



The pressure is on to stay relevant

Google and Walmart also announced their partnership this past summer, which allows Walmart to sell its products through Google’s voice-activated devices as well as Google Express.

National and regional traditional grocers also are feeling the pressure and need to strategize on how best to remain relevant by leveraging data from their loyalty programs to defend their position in the space.

What will this mean for your CPG retail marketing efforts?

This merger has many implications, but here are the top five things to focus on right now:

  1. Updating technology in-store
    Technology teams for the two companies have begun integrating Amazon Prime into the Whole Foods point-of-sale system and, when complete, Prime customers will receive special discounts and in-store benefits.

    Additionally, they’re testing their no-cashier pilot store in Seattle, where customers walk in, select items and walk out. Consumers will grow to expect similar experiences across the industry.
     
  2. Enhancing consumer data
    Amazon’s customer base is vast and comes with extensive data about their customers. Now with Whole Foods, they’ll gain an even further competitive edge by introducing Prime as the new in-store loyalty program, adding another data source to round out a robust profile of their customers.

    Retailers will feel the heat as Amazon uses these new insights to disrupt the landscape for categories like natural/organic and specialty foods.

    They will require taking a hard look at internal data and proactively creating plans to further enhance their first-party data to drive strategic competitive plans.
     
  3. Expanding private label
    Amazon expects to grow Whole Foods’ 365 brand through funding its in-store development as well as selling the brand through Amazon.com, expanding its reach to millions.

    Amazon’s brick-and-mortar addition allows them to test these products in store as well as online—shaping the future of Private Label with new, interesting items and push development in this rapidly growing segment.
     
  4. Lowering prices
    Amazon lowered Whole Foods’ prices to make them more competitive in the market, which increases revenue for the retailer.

    Understanding the price sensitivity of your consumer will have continued importance in the future. This means adjusting prices where and when it matters most or continuing to offer discounts and rewards through other means is critical.
     
  5. Focusing on delivery
    Acquiring Whole Foods brings Amazon one-step closer to cracking the code on delivery of fresh groceries. AmazonFresh Pickup opened in two stores last May—now 431 Whole Foods Stores offer this quick 15-minute service.

    Grocers will need to develop smart strategies to entice new customers to join online shopping programs and develop quick delivery and service needs.

Retailers must continuously rationalize offer and pricing strategies, plus digital reach, to maintain a relevant and impactful conversation with their shopper.

Effective use of shopper data combined with additional insights drives efficient execution and allows retailers to target their most loyal and lucrative shoppers with an experience that matters to them. 

Our strategic expertise in both relevant and personalized marketing raises the bar for retailers and allows them to compete in this ever-changing environment. 

Contact our data experts at The Data Hotline to help you stay relevant in this competitive space. (What's The Data Hotline?)

About Beth Curran and Erica Monteith













Beth & Erica leverage their retail and digital expertise to lead CPG retail strategy and drive thought leadership across the Consumer Packaged Goods (CPG) Retail vertical.

The duo works across all accounts as strategic consultants helping retailers leverage data to build effective marketing strategies to help clients optimize their messaging and targeting.

Stay up to date with all the latest in data-driven news by following @OracleDataCloud on Twitter and Facebook!

Image: Shutterstock

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