Amazon Adds Whole Foods to their Shopping Cart

Extensive mergers, acquisitions and divestiture activities have occurred in recent years because the retail environment has not been doing well post-recession. The effects of these strategies on retailers is that they gain market share against their competitors, increased retail knowledge and locations. It is also an opportunity for a retailer to expand their portfolio and services to branch out into another industry they are interested in. A merger or acquisition could also mean cutbacks, resulting in employees getting laid off, however it could also create more jobs, depending on the situation. The effects on consumers is that the retailer might lose their brand identity and consumers will feel like they are shopping at a new store, not the same one they are accustomed to. On the other hand, consumers might be in favor of the merge because it could create a more convenient shopping experience for them to enjoy.

An example of an acquisition is Amazon and Whole Foods. Amazon recently bought Whole Foods for $13.7 billion dollars. Amazon Prime members will be qualified to join Whole Foods’ customer rewards program, providing members with in-store savings. Also, Whole Foods’ private label products will be sold through Amazon’s different platforms such as Fresh and Prime Pantry, expanding their product line. Another benefit of the acquisition is that customers can have their grocery products shipped from Amazon to pick up at Whole Foods (McCarty, 2017). With this acquisition, Whole Foods prices have decreased and are now selling Amazon products, such as the Echo. Whole Foods also provides Amazon a retail location to establish pop-up shops (Taylor, 2017). This acquisition provides more jobs, and expands Amazon’s capabilities as a retailer. Consumers and Amazon prime members will be able to reap many of the benefits from this acquisition because their shopping experience will be streamlined. They can now easily buy their groceries and common household products, or frequently purchased items all from one retailer, Amazon.

McCarty, D. 2017. E-commerce and internet retail three retail mergers and acquisitions that will shake up the industry in 2017 and beyond. OneSpace.

https://www.onespace.com/blog/2017/10/three-retail-mergers-acquisitions-will-shake-industry-2017-beyond/

Taylor, K. 2017. Here are all the changes amazon is making to whole foods. Business Insider.

http://www.businessinsider.com/amazon-changes-whole-foods-2017-9/#whole-foods-immediately-slashed-prices-and-announced-another-round-of-price-cuts-in-november-1