It may not seem like it at first glance, but when you make a visit to the grocery store every week, you're visiting a fragmented part of the retail space. This is hard to identify if you're one of the millions of Americans who visits the same store regularly and doesn't often switch your shopping habits up. Related: Nike CEO blames oddly specific problem for brand issuesIf, for example, you pop into your local Kroger (KR) or Walmart (WMT) every week, you probably don't notice a lot of changes. Sure, large supermarkets have been steadily adding new brands that they hope might move more high-margin merchandise faster. But the brand names you go for, whether it's in the cereal aisle or the snack aisle, really don't change too often.When you zoom out, though, a broader trend in the grocery space begins to emerge. Grocery is complicatedThe market has been splintering, as consumers diverge by disparate shopping preferences. This trend has largely been going on for the past four or so years, ever since the Covid pandmeic, and has now accelerated as giants in the space work to consolidate market share. Some shoppers, for example, prefer to shop as they did pre-covid, making the regular (often weekly) trek to their local supermarket and picking up brand-name essentials, even as prices fluctuate. Others hop around from niche market to market, seeking specialty foods for different recipes and seasonal goods. But the fastest growing group is those customers who prefer to order online, allowing strangers on fulfillment apps to shop for them and deliver to their door, typically within a few hours of order placement.Amazon solving a big grocery problem Enter Amazon (AMZN) , which has been working for years to simplify the grocery shopping experience. It acquired Whole Foods in 2017 for $13.7 billion, a purchase which has largely been a success as it's managed to lower prices, particularly for Prime members, and expand Amazon's reach in brick and mortar. And now, the retail giant is launching a new feature available to Prime members which will make the grocery procurement process even easier. On April 23, the retail giant introduced a subscription-based grocery delivery service. The option is available for $9.99 per month ($4.99 monthly for SNAP/EBT customers) and will roll out across 3,500 cities in the U.S.
A Whole Foods employee scans a bunch of kale.Amazon/Whole Foods
Here are some key features of the Prime grocery delivery subscriptions:Available at Whole Foods Market, Amazon Fresh, other local grocery and specialty retailers on Amazon.comUnlimited delivery on orders over $3530-day free trial for interested customersOne-hour delivery windowsPriority access to recurring reservations on weekly ordersSome of the specialty retailers available through the service include Cardenas Markets, Save Mart, Bartell Drugs, Rite Aid, Pet Food Express, and Mission Wine & Spirits.“This new grocery subscription benefit provides even more value and savings on delivery fees for customers who regularly order groceries from Amazon Fresh, Whole Foods Market, and the variety of local grocery and specialty retailers on Amazon.com,” said Tony Hoggett, senior VP of worldwide grocery stores at Amazon. “Our goal is to build a best-in-class grocery shopping experience—whether shopping in-store or online—where Amazon is the first choice for selection, value, and convenience. We have many different customers with many different needs, and we want to save them time and money every time they shop for groceries.”Amazon says the subscription pays for itself in as little as one order per month from Whole Foods, and of course, Prime members will still earn 5% back when using their Prime Visa for orders.
