Mark Mahaney, senior technical analyst at Royal Bank of Canada, said in an interview with CNBC a few days ago that with the recent Prime Minister’s new deal, Amazon is expected to double its customer base for its Whole Foods supermarket.
The global e-commerce giant said on Monday local time that all Whole Foods supermarkets in the United States this week will provide Prime members with additional in-store discounts, as well as additional discounts for Prime Now online orders. In addition, this week's Total Food Supermarket will also offer additional discounts for "hundreds of discounted merchandise", including whole-food fresh broiler catches, frozen foods and large items.
"If Amazon has 60 to 70 million Prime members in the United States, then there could be 20,000 to 30 million people living in the vicinity of Whole Foods, but they may not have frequented the whole food before." However, if Amazon continues to provide Prime members with incentives for full-food shopping, the total food customer base in the next 5 to 10 years is expected to double, which is the synergy that Amazon expects when it bought the Whole Foods supermarket. & rdquo; Mahaney said.
Prime is a paid membership service launched by Amazon. Users who subscribe to Amazon Prime can enjoy unlimited Amazon overseas purchases and free delivery of domestic orders throughout the year, as well as access rights to Amazon streaming services.
At the moment, it is still difficult to judge how much synergies the entire Amazon will bring to the new Prime Minister’s New Deal, but this is obviously a step that Amazon must take.
"It is reasonable to integrate the total membership plan with Prime and Prime. These two plans can fully realize the complementary advantages." & rdquo; Mahaney said.
As is known to all, Amazon purchased Whole Foods Supermarket at a price of US$13.7 billion last year, and after the acquisition was completed, it quickly supplied many of its own products and services to this premium fresh organic food supermarket. Currently, Jeff Wilke, CEO of Amazon's global consumer business, is responsible for integrating Whole Foods Supermarket into the Amazon system.
But not so long ago, Whole Foods co-founder and CEO John Mackey mentioned at a company meeting that there was a renewed tension between Whole Foods and parent Amazon. McGee did not specify exactly what conflicts he had with Amazon, but he made it clear: "If I think it is necessary, I will not hesitate to fight back." I am not afraid that they will expel me. This gives me the courage to speak to power. I have done so many times. Amazon accepted my opinion and they gave in. ”
Mahaney currently gives Amazon a "outperform" rating, which sets the company's 2019 target share price to reach $ 1900, which is more than 10% up from the current $ 1715 share price.