Amazon’s Latest Announcement: Just Another Example of Systems Thinking
Amazon recently announced that it will now be offering free 2 hour Whole Foods delivery to prime members in select states. This announcement is not very surprising, ever since Amazon acquired Whole Foods last summer people have been expecting some sort of service connecting amazon’s distribution expertise and Whole Food’s products. This also is not even an innovative service, the grocery delivery market is already a very competitive space with many other companies likely to join in as well. So it would appear that Amazon has an uphill battle ahead of them in order to be market leaders here, but is that the only way they would consider this service a success?
When looking at this from a systems thinking perspective getting involved in this market is likely only a positive for them. By providing this service they continue to give people more and more reasons to do all of their shopping from home. Groceries are an essential for everyone and for those who have not already switched to grocery delivery this Amazon/Whole Foods deal might change that (especially if they are loyal Whole Foods customers or already Amazon Prime members). So with customers no longer leaving their house to shop for their groceries many will decide to also buy other supplies online that they would typically get on the same trip and amazon has those supplies. Also by adding this service they gain more customer data which can enhance their advertising and algorithms on their customer’s interests (which is already a strength for them). Even if Amazon gets stuck in the pack of many companies providing grocery delivery services, the continued push towards complete online shopping that this move represents is a positive for them. As more customers get used to never leaving the house for shopping, Amazon will have more potential customers in the market they already dominate, online retail.