Amazon (AMZN - Free Report) is leaving no stone unturned to bolster presence in the retail sector. The company has announced the availability of Prime benefits at all Whole Foods Stores as well as Whole Foods Market 365 stores nationwide.
The latest move is in sync with the company’s previously announced plan of making the Prime savings available at all Whole Foods stores across the United States by this year’s summer. Notably, the number of Whole Foods stores across the country is currently 463.
Per the announcement, the Prime members will be able to avail the facility by Jun 27. Further, the Prime members will receive 10% discount on several items and other special discounts on selected grocery products like sockeye salmon, organic red cherries, Mochi ice cream, nuts, granola, dry fruits, to name a few.
Notably, the company’s focus on growth efforts is likely to bolster customer base. Moreover, the customer friendly Prime benefits are likely to drive the Prime subscription growth which will aid its top-line growth.
Coming to the price performance, shares of Amazon have returned 42.2% on a year-to-date basis, outperforming the industry’s rally of 22.8%.
Prime Benefits: Key Catalyst
Amazon Prime services are getting enhanced day by day with the help of exciting discounts, expanding free two-hour delivery facilities, Prime wardrobe and growing movies, audio and video portfolio.
The company has recently rolled out services for the delivery of natural and organic products such as fresh produce, everyday food items and quality meat and seafood, purchased at Whole Foods via Prime Now in Chicago, Houston, Indianapolis, Minneapolis and San Antonio.
Moreover, the company’s free two hour grocery delivery service for the Prime shoppers at Whole Foods, along with Prime Savings is now available in Atlanta, Austin, Baltimore, Boston, Cincinnati, Dallas, Denver, Los Angeles, Philadelphia, Richmond, Sacramento, San Diego, San Francisco and Virginia Beach.
Additionally, Prime members in the United States have started receiving unlimited free two-day shipping on over 100 million different items. The company also offers 5% cash back benefit to Prime members who use Amazon Prime Rewards Visa card while shopping at any Whole Foods store.
Consequently, we believe the above mentioned benefits will continue to attract more members for Prime. This will help in gaining further traction in the market.
Rising Competition in Retail World
Amazon’s continued focus on expanding its footprints in the rapidly growing retail market with the help of strategic acquisitions and partnerships bodes well for its strengthening market position.
According to the latest report from Mordor Intelligence, the global retail industry is anticipated to grow at a CAGR of 5.3% between 2018 and 2023 and to reach $31.9 trillion by 2023.
The successful acquisition of Whole Foods Market and robust Prime has played a significant role in shaping its growth trajectory in the grocery retail market.
This has also helped the company in gaining competitive edge against the likes of – Walmart (WMT - Free Report) , Target (TGT - Free Report) and Kroger (KR - Free Report) – the big players of U.S. grocery market. Moreover, Amazon’s two-hour delivery system has intensified the competition in the space.
Notably, all three are continuously making efforts to enhance their same day delivery mission with the support of acquisitions and partnerships.
Further, Amazon has recently extended its partnership with Sears as per which the latter will provide 71 additional auto centers to the former, bringing the total count to 118. Courtesy to this, the car tier customers of Amazon will be able to avail the installation service at these centers.
This move of Amazon will help in strengthening its competitive position against Walmart which also keeps tire as a product.
Consequently, the company’s strong retail strategy along with efficient delivery services and e-commerce skills will continue to help it in sustaining momentum in the market.
Currently, Amazon carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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