The low-margin grocery sector has become a high-stakes battleground with a variety of new and existing players competing for share. The latest field of battle: paid search, where spending by grocery brands has exploded.
Speaking to Whole Foods employees in a town hall meeting after the deal was announced, CEO John Mackey described his meeting with Amazon as a “blind date,” set up by “mutual friends.”
The ecommerce giant said it would acquire the organic food pioneer in a deal valued at $13.7 billion. The acquisition highlights the rapid pace of change in the grocery sector, where evolving consumer tastes have created challenges for traditional chains, and ecommerce is still in its infancy.
The grocery giant reported that comparable sales, excluding fuel, edged lower in the fiscal first quarter and warned that price competition will pressure margins this year. Here are some key data points showing the retailer's performance, drawn from the eMarketer Retail & Ecommerce database.
Lidl, which is gearing up for its US debut, occupies a sweet spot of the market, the so-called deep discount sector, where growth has outpaced that of conventional grocery stores, supercenters, warehouse clubs and mass merchandisers.
Low-price German grocery chain Aldi set plans to aggressively ramp up its growth in the US, saying it would remodel 1,300 stores by 2020 and expand to 2,500 stores nationwide by the end of 2022.
Brick-and-mortar store sales of fast-moving consumer goods slid $2.9 billion in the first quarter, depressed by deflationary pressures and a quirk in the calendar, but also by shifting consumer tastes.
Roughly half of consumers never buy groceries online, a new survey found, but they tend to think they'll be buying more online in the future.
Grocers are building up their omnichannel efforts, but for most, it’s still a work in progress. According to a survey of grocery executives by Progressive Grocer, just 12.2% of grocers have a “fully integrated strategy” for omnichannel retailing.
While the majority of grocery shopping is still conducted in-store, more consumers are testing and adopting ecommerce options for buying food. Brands and retailers are beginning to put the pieces together to offer more online options.