Next Up at Amazon-Run Whole Foods: Half-Priced Halibut Steaks
Posted May 16, 2018 2:05 a.m. EDT
Updated May 16, 2018 2:06 a.m. EDT
SEATTLE — Amazon Prime is the kitchen sink of membership programs. The internet retailer keeps cramming new benefits into it — music and video streaming, fast shipping and online photo storage.
Next up: ridiculously inexpensive halibut steaks from Whole Foods.
On Wednesday, the company will unveil the next stage of its step-by-step makeover of Whole Foods Markets, the grocery chain it acquired last year, with a collection of store discounts aimed at Prime members. Whole Foods customers who are also Prime members will get 10 percent off hundreds of sale items in stores, including tilapia, organic baby kale and chicken breasts.
Amazon is rolling out the discounts in Whole Foods stores in Florida on Wednesday and will expand them to across the country this summer. It is also offering Prime members much deeper discounts on a handful of items that will change weekly, some of which are eye-catching.
For instance, this week in Florida, wild-caught halibut steaks will be $9.99 a pound, about half the regular price. One pound of organic strawberries will be $2.99, or $2 less than usual. Customers who buy one 12-pack of 365 Everyday Value sparkling water will get a second one for free.
“I think this is one of the most important launches we’ve had for Prime since Prime Video,” Cem Sibay, vice president of Amazon Prime, said in an interview.
Amazon has already fiddled with prices at Whole Foods to refashion its image as wallet-busting seller of healthy foods. It has made seasonal and permanent discounts on some items for all customers, not just those who subscribe to Prime. Prime members who use an Amazon-branded Visa card get 5 percent cash back on all their Whole Foods purchases, while also getting two-hour home delivery of Whole Foods groceries through the company’s Prime Now service.
Amazon has more than 100 million Prime customers worldwide and recently announced that it would increase the membership fee for the service, to $119 a year from $99, to pay for all the new benefits it is adding to it.
Sucharita Kodali, an analyst at Forrester Research, said the discounts were likely to hurt the profit margins at Whole Foods — but that was besides the point if the move strengthens Prime, a major focus of Amazon these days.
“I don’t know that it will be great from a profitability standpoint, but I don’t know that they really care,” she said. “It’s more customer engagement and customer satisfaction. Maybe it gets them more Prime customers, more Whole Foods usage and more units per cart.”