Will L.A. Love AmazonFresh?
Even a broken clock is right twice a day, so it appears as though all the predictions that AmazonFresh will expand beyond Seattle will soon be proven correct, perhaps as early as this week.
According to reports, AmazonFresh has chosen Los Angeles as its first population dense market, with San Francisco following later in the year.
While some question whether Amazon can make a go of an online grocery business with razor thin margins and high shrink rates, others maintain the venture is really about add-on sales of higher margin items as part of the e-tail giant’s plans to eventually roll out same-day delivery on a national scale. In an April RetailWire poll, 82 percent said adding groceries was somewhat (35 percent) to very important (47 percent) for Amazon to achieve the scale needed to support same-day delivery on a widespread basis.
Count Manfred Bluemel of Zeitgeist Research among those who think AmazonFresh can pull it off. "Grocery is a frequency business. If Amazon can deliver to consumers’ homes two or three times a week, they can up-sell other items," he told Reuters.
- Amazon plans big expansion of online grocery business – Reuters
- What’s the Motivation Behind AmazonFresh? – RetailWire
- Is Amazon Ready to Deliver Groceries Beyond Seattle? – RetailWire
Is Los Angeles the right market for AmazonFresh to begin its expansion beyond Seattle? From which companies in the L.A. market will Amazon find it hardest/easiest to grab share?