On August 28th 2017, the e-commerce giant bought Whole Foods for $ 13.7 billion and with it 465 physical stores — increasing its physical presence by over 25 times.
By the end of 2017, the e-commerce giant accounts for nearly 45% of all U.S. e-commerce sales. While that may not scare brick-and-mortar retailers, which cater to the roughly 90% of shopping that still takes place in stores, Amazon's push into physical retail is rattling Wall Street.
The day news hit that Amazon would take over the upscale grocer, shares of Target fell 5%, Costco dropped 7%, Kroger 9% and SuperValu plunged 14%.
Amazon has also begun selling Whole Foods' private-label products, including 365 Everyday Value, on Amazon.com, AmazonFresh Prime Pantry and Prime Now. By October, Amazon had raked in $1.6 million worth of Whole Foods private label products on Amazon.com.
Amazon immediately began using Whole Foods stores to boost device sales. Ahead of the holidays, over 100 Whole Foods stores will carry the new Amazon Echo, Echo Dot, Fire TV, Kindle and Fire tablets, and in several markets, Amazon will also host pop-up shops at Whole Foods stores, where customers can learn about devices as well as Prime Video and other loyalty perks. For Amazon, physical stores are in many ways the missing piece to its marketing efforts.
Amazon’s purchase of Whole Foods shows the e-commerce giant is a serious threat not only online but in the brick-and-mortar ecosystem, too. More acquisitions are likely to come as Amazon expands its offerings in apparel and consumer goods.