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Amazon Acquisition of Whole Foods Marks One Year Anniversary

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You may recall that one year ago in August 2017, the stock prices of grocery retailers and wholesalers, along with the stock prices of pharmaceutical companies and drug chains, dropped in response to the  announcement of Amazon’s purchase of Whole Foods coupled with the rumor that the online giant was contemplating entering the pharmaceutical space next.

Twelve months later – Amazon continues to re-shape the retail world

The company’s unorthodox retail initiatives are extraordinary, including the power of its Prime Benefits program, its Amazon Go cashier-less convenience stores, the launch of Amazon Lockers, and its ability to merge multiple channels to create an unparalleled customer experience. These concepts represent just some of the well-recognized and successful moves that are likely to be changing the retail landscape forever.

Financial reports paint an interesting picture

Since the acquisition of Whole Foods one year ago, an analysis of the results are strong and positive. In fact, Amazon has captured 18% of all online grocery sales in the United States - which represents the largest share of any single retailer, according to One Click Retail, an e-commerce intelligence firm.

The “bricks and mortar” concept is not dead 

Cameron Peebles, Chief Marketing Officer at the digital marketing firm, inMarket, points to data that demonstrates the number of shoppers visiting Whole Foods has grown 5.5% faster than at traditional groceries. Peebles says that brick and mortar retail will remain competitive as it evolves and changes. As he notes, ‘Brick and mortar is alive and well – it’s just different.’ 

And Amazon is deepening its’ own brick and mortar presence.  Peebles sees the statistics regarding the increasing number of shoppers at Whole Foods and he reminds us that if you can, “Get people to make their first purchase, then you can grow the business from there.”  It is a concept Amazon understands very well  - as do others.

Other retailers are also staying strong, refusing to fold up their tent. Alice Hodgson writes in Insight Manager, “Let’s take a look at Apple. The stores are not only designed to drive transactions, but everything else that can’t be done on line, such as build relationships, offer services, solve problems and ultimately upsell.” 

Brick and mortar retailers are changing the way they interact with customers in order to create a great experience. And they can breathe a sigh of relief when they see the results of the CBRE survey of 2016 saying that 70% of global millennials prefer to shop at bricks and mortar retail stores. This in spite of their being dubbed ‘digital natives’ as a generation that has grown up with technology embedded in their DNA!   

And the trend is not only for bricks and mortar to dig in, but also for e-commerce players to tryout a bricks and mortar presence in a reverse move.   Surprisingly, close to 20 online United States companies have opened physical stores including some smaller names in the specialty areas like Birchbox serving the beauty products sector and Bonobos establishing a foothold in apparel.

Contact us with questions or comments!

As we continue to monitor the retail sector, sharing on-line and in-store trends, potential opportunities and challenges, we will also specifically focus on bringing you current industry news. From changes in online holiday shopping to changes in online grocery shopping and from changes in customer preferences to changes in purchasing habits, we are committed to bringing you relevant and timely information as the retail market moves forward, adjusting to, and embracing, a new frontier. 

Please feel free to contact us at Sobel & Co. by phone at 973-994-9494 or by email at

John.Mellage@SobelCoLLC.com or Chris.Martin@SobelCoLLC.com

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