Whole Foods Part of Amazon's One-Two Punch for Leveraging Multi-Channel Growth, reports Packaged Facts

Looking ahead to 2020 and beyond, annual double digit growth is realistic for Amazon in the food & beverage market

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Aug 30, 2017, 08:13 ET

ROCKVILLE, Md., Aug. 30, 2017 /PRNewswire/ -- Online grocery shopping has begun to catch on. Now, with the one-two punch of Amazon's AmazonFresh expansion and the etailer's pending acquisition of Whole Foods, there's little doubt that food and beverage ecommerce will receive a shot of adrenaline. As market research firm Packaged Facts forecasts in the brand new study, U.S. Grocery Market Focus: The Amazon Food Shopper, though Amazon currently garners only a small share of overall grocery sales, that share will trend upward in the coming years.

Presently, Packaged Facts estimates Amazon's 2016 online food and beverages sales, including AmazonFresh, at $1.5 billion, and it expects them to rise to $2.3 billion in 2017, giving it a 19% share of the online market. Looking ahead, growth of 70% during 2018 and 2019 is realistic, as Amazon pivots to leverage its Whole Foods acquisition into multi-channel growth. Longer term, even average growth during 2021 and 2025 would catapult Amazon's food and beverages sales well past $30 billion.

Importantly, while its growth curve is nothing to trifle with, estimated sales between 2018-2020 make only minor inroads into total food-at-home sales. Realistic projections for Amazon's market share gains hardly equate to industry ownership, and the etail titan would still trail national chains such as Walmart and Kroger.

"Will Amazon overtake the food and beverage market? No, but perhaps most importantly, Amazon's major foray into food will surely stretch margins in an industry where they are already notoriously thin. This will in turn likely result in additional industry mergers and alliances geared toward managing costs, as other retailers seek to stay in the game with a competitor long known to absorb heavy losses over time in its quest for market share," says David Sprinkle, research director, Packaged Facts.

Moreover, Packaged Facts also anticipates that any success Amazon has with food will also translate to strengthening its Amazon Prime value proposition, giving more shoppers more reasons to buy three times products across categories. In this respect, food sales growth will contribute to sales growth in Amazon's other retail categories.

About The Report

Packaged Facts has published its first dedicated report on Amazon, including two spin-off options, one of which is U.S. Grocery Market Focus: The Amazon Food Shopper. The report provides unique and fully up-to-date insight on the role Amazon plays in shaping grocery trends. It focuses on Amazon products and services engagement over time, with the analysis providing portraits of the Amazon shopper, the Amazon media user, and the Amazon Prime member. The report also assesses Amazon's numerous strategies to broaden its reach into U.S. homes and wallets, including segmented subscriptions, penetrating and deepening retail categories, expanding Alexa's reach, moving into social media and multi-channel initiatives. Detailed data are provided on Amazon Prime, its relationship to the consumer, and the ways it is leveraged to drive engagement and increase sales.

Analysis and data highlights include:

e-Commerce sales and food & beverage e-commerce sales projected through 2020
Amazon food & beverage e-commerce sales projected through 2020
Historical trending of food retailer usage and Amazon user share
Demographic analysis of Amazon food-centric programs
Demographic analysis that covers detailed household income segmentation (including $150K-$249K and $250K+ brackets) and geographical analysis (top fourteen designated market areas, designated market areas by segments, metropolitan areas by segment, and county size).

View additional information about U.S. Grocery Market Focus: The Amazon Food Shopper, including purchase options, the abstract, table of contents, and related reports at Packaged Facts' website: https://www.packagedfacts.com/Grocery-Focus-Amazon-Food-Shopper-11066906/.

Find additional Packaged Facts food and beverage reports at: https://www.packagedfacts.com/food-beverage-market-c84/.

About Packaged Facts

Packaged Facts, a division of MarketResearch.com, publishes market intelligence on a wide range of consumer market topics, including consumer demographics and shopper insights, consumer financial products and services, consumer goods and retailing, consumer packaged goods, and pet products and services. Packaged Facts also offers a full range of custom research services.

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SOURCE Packaged Facts