Amazon to offer free grocery delivery for Prime members
Amazon has yet to find the key to unlocking huge grocery sales. Now, the company is trying a new tack: free delivery for more people.
On Tuesday the company announced free two-hour grocery delivery for Prime members in more than 20 major metropolitan areas. The changes eliminate what had been a monthly $14.99 fee for people shopping on Amazon Fresh, its online grocery service that delivers milk, eggs, seafood and other perishable products from its warehouses.
The new delivery option is in addition to the free delivery Amazon offers to Prime members who shop at most Whole Foods Market stores. Both methods require a minimum purchase for $35 to have no delivery fees. Prime memberships typically cost $119 a year.
Amazon has long wanted to make headway in the $700 billion grocery industry — it is not only an immense market, but also a category that customers buy with high frequency.
Amazon bought Whole Foods two years ago, by far its biggest splash in the industry. So far, though, the impact at Whole Foods’ physical stores and on Amazon’s bottom line has been modest. But the glimmers of hope Amazon has seen from buying Whole Foods has largely been from delivery.
“We made Fresh both available to more customers, and much faster, over the past year,” said Stephenie Landry, Amazon’s vice president of grocery delivery.
Landry explained that while Whole Foods orders were fulfilled in the grocery stores, Amazon delivers its Fresh orders from small fulfillment centers located close to customers.
“We have opened more of those over the past year, and that’s what enables us to offer free two-hour delivery,” she said.
Amazon Fresh sells a broader selection of branded products like Doritos or Coke that Whole Foods does not carry.
At a traditional grocery store,...