Three months after Amazon slashed some Whole Foods prices by as much as 43% on the day its purchase of the grocery chain closed in its first (of many) attempts to steal market share from competitors by selling at a loss, today Amazon announced round 2 of the grocer wars, when it unveiled even more discounts on several grocery products at Whole Foods, just days ahead of the Thanksgiving holiday, sending stocks of rival ultra-low margin grocers tumbling.
The lower prices include deeper discounts on some items for Amazon Prime members and come on top of price cuts already announced by Whole Foods in August. Among the price cuts, Whole Foods said it would sell organic turkey for $3.49 per pound to all customers, while Prime members could buy it at an even lower price of $2.99 a pound.
More price cut details:
Whole Foods Market will also offer lower prices starting today on an additional selection of customer favorites across its stores, including: Value Pack Boneless Skinless Chicken Breasts (Organic and No Antibiotic), Responsibly Farmed Raw Peeled Shrimp, and holiday favorites such as 365 Everyday Value Canned Pumpkin, Organic Broccoli, 1lb Organic Salad Mixes, Organic Russet Potatoes, and Organic Sweet Potatoes.
All customers will also see reduced prices on products from some of the most well respected natural and organic brands, including Organic Rice from Lundberg Family Farms, Organic Beans from Eden Foods, Organic Chicken and Vegetable Broths from Pacific Foods, Organic Eggs and Milk from Organic Valley, and Toothpaste from Tom’s of Maine. Whole Foods Market is also offering lower everyday prices on some of the most popular products from well-known brands such as Chobani Yogurt, California Olive Ranch EVOO, Siggis Yogurt, Applegate Hot Dogs, and Fage Yogurt.
Whole Foods Market customers are increasingly interested in buying eggs from hens that have access to pasture and so Whole Foods Market is excited to be able to offer lower prices on the entire line of Pasture Raised Eggs from Vital Farms, including their Vital Farms, and Alfresco Brands.
“These are the latest new lower prices in our ongoing integration and innovation with Amazon, and we’re just getting started,” said John Mackey, Whole Foods Market co-founder and CEO. “In the few months we’ve been working together, our partnership has proven to be a great fit. We’ll continue to work closely together to ensure we’re consistently surprising and delighting our customers while moving toward our goal of reaching more people with Whole Foods Market’s high-quality, natural, and organic food.”
The latest price cuts are a “sneak peek” of the savings and in-store benefits that Whole Foods will offer once it begins using Prime as its loyalty program, the grocer said.
Previously, channel checks showed that Whole Foods had cut prices on items including bananas, avocados to draw customers away from retailers such as Wal-Mart and Trader Joe’s.
News of the price cuts slammed the shares of its competitors such as Costco, Sprouts Farmers Market, and Kroger, as nervous Investors have been watching and waiting for any further price cuts at Whole Foods, and their adverse effects on the U.S. grocery industry, which is already reeling under a brutal price war. Kroger fell as much as 3.5 percent to $21.25, its biggest intraday decline in a month. Sprouts tumbled as much as 3 percent to $19.98.
Amazon, which branched out into brick-and-mortar retailing with its purchase of Whole Foods in its endless quest for global monopolistic domination, hopes to upend the grocery industry and undercut traditional retailers by using its deep pockets, triple digit PE multiple and large presence. And, as the chart below shows, investors have been jumping over themselves to reward Jeff Bezos - now the world's richest man - as he creates the world's most comprehensive commerce monopoly.