With Amazon's latest purchase, the battle for your organic toilet paper is on. By that I mean the delivery grocery wars between tech giants Instacart, Google Express, and Amazon Prime Pantry, along with retail stores like Walmart, Kroger and Target’s Restock box o’ stuff has begun. And it's going to get messy.
According to an article by CNBC, online grocery shopping could increase by 5x in the next 10 years and “American consumers spending upwards of $100 billion on food-at-home items by 2025.”
The convenience of someone else bringing you everything from your paper towels and diapers to organic cereal and fresh baked bread are becoming more of a norm.
Today, Amazon is upping the ante and expanding their organic Prime Pantry. The company announced they are purchasing Whole Foods Market for $13.7 billion in cash, plus the net debt. That’s a lot of granola bars.
“Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy,” said Jeff Bezos, Amazon founder and CEO. “Whole Foods Market has been satisfying, delighting and nourishing customers for nearly four decades – they’re doing an amazing job and we want that to continue.”
According to the Organic Trade Association (OTA) “consumer demand for organic has grown by double-digits nearly every year since the 1990s. Most impressively, organic sales have increased from $3.6 billion in 1997 to $43.3 billion in 2015.” And Millennials are driving this demand, particularly in urban population areas.
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In the same article by CNBC the report found “millennial shoppers surveyed were more willing to buy groceries online in the future than other consumer groups.”
Based on the data by the OTA, Amazon might see an initial surge of organic orders from the highest concentration of organic hot spots located (no surprise) along the west coast, then the north east, upper midwest and Colorado.
“We know that organic agriculture benefits our health and our environment. This significant research shows organic can also benefit our livelihoods and help secure our financial future,” said Laura Batcha, CEO and Executive Director of OTA
For Amazon, getting even deeper into the organic food market will allow them to expand their customer base and the extensive products will pair nicely with their Amazon Fresh and Amazon Go services.
Don’t worry, the Whole Foods brick and mortar stores will still be there for patrons to get their morning organic coffee and muffin, and carry foods from their regular vendors and partners. In addition, Amazon announced that “John Mackey will remain as CEO of Whole Foods Market and Whole Foods Market’s headquarters will stay in Austin, Texas.”
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