Whole Foods Rolls Out Discounts For Amazon Prime Customers In New Grocery War

Amazon has proven that shoppers are interested in signing up for Prime memberships that save them on shipping charges in a big way. So far, most benefits of Prime have been in the virtual world with shipping discounts and streaming video, but that has changed with new Whole Foods discounts for members.

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Whole Foods, owned by Amazon, has now debuted a loyalty program that offers Prime members special discounts in the store. The Prime discounts include 10% off sale items and weekly specials that rotate. An example of one of those weekly rotating specials recently was $10 off per pound of wild-caught halibut steaks.

The catch is that right now the Prime member discounts are reportedly only available in Florida, but they will be rolling out to other Whole Foods locations this summer. Amazon has been trying to convert its loyal online Prime shoppers to become loyal Whole Foods shoppers and have previously offered free two-hour delivery from Whole Foods stores.

Competition in the grocery market is fierce with leaders being Walmart and Kroger. Whole Foods is viewed by many as overpriced; discounts to Prime members might lure some of them away from Walmart and into the pricier Whole Foods locations for shopping. The grocery market is a massive one worth $800 billion in the States.

Amazon and Whole Foods want the biggest part of that pie they can get. The 463 Whole Foods locations in the U.S. currently have only about 1% of that grocery business. The new discounts could make Whole Foods the cheaper alternative for shoppers according to analysts. Amazon CEO Jeff Bezos has shown he is comfortable with lower margins to increase business and that is likely to rub off on Whole Foods and could lure in new customers.
Amazon recently boasted that it has over 80 million subscribers in the U.S. alone. Subscriber numbers are expected to continue to grow significantly even though Amazon has announced that it is increasing the cost of Prime memberships to $119 from the $99 they have been since introduction.