According to Thasos Group, which analyses mobile location data of 10% of the US population, customer traffic shot up 31% compared to the same time last year on the first day that Amazon cut prices on select items at Whole Foods on 28th August.
A week later, traffic was running 17% higher year on year - and by the week ending 16th September, traffic remained up 4%, Reuters reported.
This increase was to the detriment of rivals, with Trader Joe’s hit the hardest. In the period 28th August to 3rd September, 10% of its customers visited Whole Foods. In addition, 8% of Sprouts customers visited the premium grocer.
However, the top source of new customers were Walmart and Kroger, accounting for 24% and 16% of Whole Foods new customers respectively. These have millions of shoppers and are leaders in the market.
“Amazon’s acquisition of Whole Foods has the potential to be a gamechanger in the grocery space,” said Thasos Group Chief Executive Greg Skibiski. The demographics that it attracted did not change much from the high-income customer typical of Whole Foods.
According to the Wall Street Journal, the integration of Amazon’s e-commerce firepower is having significant financial effects. In the first month, the parent company’s site sold around $1.6m in Whole Foods store-brand products in its first month as owner.
The benefit to Amazon is the ability to take a healthy food product to a mass market. Diana Sheehan, director of Retail Insights at the Kantar Retail consultancy, told the Journal that Whole Foods basics range is probably one of the most valuable parts of the business for Amazon. “The 365 private label has probably some of the strongest brand equity in the nation,” she added.
Sourced from Reuters, Wall Street Journal; additional content by WARC staff