• Prime Now delivery has yet to crack the code of online grocery shopping and delivery, hit with the same problems as other grocery delivery programs. After expanding in 2018 to 60 Whole Foods markets, customers are still receiving unwanted substitute products when those that they requested are out-of-stock. The issues are chalked up to a lack of integration between Whole Foods and Amazon staff (many of whom are contractors) and an outdated inventory tracking system. But it’s not a unique problem—according to the Grocery Manufacturers Association trade group, of all items that delivery companies list on their online shelves, 15% are out-of-stock.
  • Amazon is intercepting ads that market unprofitable products. Amazon will require vendors to lower the price of the item in question before it will reinstate the brand’s advertisements. In December 2018, Amazon also pressured certain vendors to raise the cost of their SKUs and/or update their packaging in order to lower operational costs for the retailer. But the recent move signals that Amazon is more interested in eliminating the product from its site altogether.
  • Amazon is discussing a partnership with Propel, an EBT app startup, in order to redirect lower-income, but digital-savvy shoppers from traditional mass retailers like Walmart and dollar stores. This is just the latest of Amazon’s strategic developments. In March 2018, Amazon launched a Prime membership discount ($5.99 a month) for shoppers with EBT and/or Medicaid cards. It also introduced a bargain section on its site, allows shoppers to use cash at certain retail locations, and opened delivery pickup points for those who cannot easily receive packages. But despite these efforts, a physical footprint will be important to compete with a company like Walmart, which has a storefront within 10 miles of every American.
  • After Philadelphia and New Jersey recently outlawed cashless stores, San Francisco may follow suit, posing limits to the growth of Amazon Go. Amazon announced in September 2018 that it wants to open up to 3,000 cashier-free stores by 2021. In addition to the recent bans, Massachusetts has prohibited cashless retail since 1978.