• Amazon continues to go after lower-income customers, infiltrating Walmart territory with a discounted Prime membership for Medicaid recipients. The membership costs 54% of a regular Prime membership at $5.99 a month, which will help Amazon broaden its customer base.  
  • Amazon’s multi-year contract and $22-billion purchase obligation from Whole Foods is an unusual and large commitment from Amazon, which prefers short-term contracts that typically pressure its suppliers to lower their prices. The contract is largely tied to a previous contract Whole Foods struck with its largest supplier, United Natural Foods (UNIF), highlighting that Amazon is confident enough in UNIF to deepen the relationship.
  • Conversely, Amazon’s Whole Foods acquisition is leaving smaller vendors worried. The grocery chain continues position itself away from a local and into a national company and Whole Foods has begun to centralize its merchandising, rather than relying on a third party, and charging vendors for this work. Overall, the shift risks sacrificing the local feel that distinguishes Whole Foods from other grocery chains in the first place.
  • Amazon continues to add additional subscriptions on top of Prime, this time making Prime Pantry a $5 monthly service. It’s the company’s attempt to make a profit from the bulky non-perishable consumer packaged goods that its competitors—Target and Walmart—specialize in and which continue to pose a challenge to Amazon, whose fulfillment expenses increased 43% because of the program between 2016-2017.  
  • Amazon and big banks, including JP Morgan & Chase Co., are discussing a partnership that would create a checking account product for Amazon’s customers. The program would continue to shift spending to Amazon and help the ecommerce giant cut out payment processing fees. Interestingly, it would remain collaborative, keeping Amazon and the bank as partners, rather than Amazon becoming a bank itself—Walmart has tried this in the past and failed because of regulatory issues.