Insights

What the Amazon Acquisition of Whole Foods Means for Grocery

By Alex Goodwin

June 16, 2017

Amazon’s acquisition of Whole Foods is sending shockwaves through the business world, as both brick-and-mortar and web-based retailers grapple to comprehend the implications of the reported $13.7b deal. Certainly, at the very least, Amazon has just picked up some 450 potential distribution centers in prime locations across the country. For Amazon, this has huge potential to ease some of the logistical challenges of the company’s vast delivery services. For the grocery industry, which has yet to see the same degree of transformation as many other retail sectors, the impacts are likely to be dramatic.

Amazon has been at the forefront of developing innovative tech-focused solutions that have turned the retail industry on its head; it remains to be seen exactly how Amazon’s global supply chain, high-tech infrastructure, creative reimagining of the customer experience, and immense financial resources will be utilized in the Whole Foods stores of tomorrow. However, it’s a safe bet that we will find out in short order. In the meantime, the rest of the grocery industry simply can’t afford to sit back and wait.

Grocery innovation

The future of grocery, like other retail sectors, will be led by stores that have a platform for innovation. This will likely mean powerful infrastructure that utilizes connected multipurpose devices capable of seamlessly executing the demands of the current customer experience and marketplace. At the same time, this infrastructure must also be sufficiently versatile to adapt to future trends as those trends develop and evolve. Companies simply can no longer afford to invest in single-purpose, disconnected devices.

Retail stores today must act as showroom, warehouse, and fulfillment center, providing both product and information wherever and however their customers need it. So what could that mean for the future of grocery in more concrete terms?

  • Connected touchpoints (from deli kiosks to price checkers to point-of-sale terminals to associate handheld tools) that deliver a seamless digital experience throughout the store, while also tracking data for analysis and optimization of the customer experience, inventory management, store layout, product location, and more.
  • Smart-device-empowered associates with full access to product information and customer needs, improving efficiency and productivity.
  • In-store kiosks that offer a branded, user-friendly interface that will make the in-store experience as convenient as shopping online, maximizing next-gen technologies such as RFID, Bluetooth, and augmented reality.

However, this isn’t some pie-in-the-sky abstract musing about possible future technologies. These tools are available now, and the starting gun for the grocery tech race was just fired. To maintain the status quo or move slowly is to sink into obsolescence. Bold, decisive action will be critical to keeping pace with the competition.

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