What Amazon’s Arrival in Organic Foods Could Mean for the Industry
Amazon’s acquisition of Whole Foods announced this last June has had organic food industry insiders wondering how much wake would be created by the e-commerce behemoth’s imminent entry into its waters. And they have reason to, owing to Amazon’s storied history of upending the norms under which stagnant industries operate.
When SEO Becomes a Factor in Food Buying
Currently, in-store grocery shoppers choose products based on what they see on the shelves in front of them. Because of thin profit margins and the high cost of rearranging shelves, that shelf space is overwhelmingly saved for the biggest and best-selling brands with only a meager portion devoted to new or otherwise unproven products. The Amazon model applied to grocery shopping will set off a clamor among brands to be sure their product surfaces first, creating a whole new competitive arena for marketers.
Entrepreneur magazine delves into what it could mean when SEO becomes a factor in what brands surface for shoppers, pointing to a Forrester Report about Amazon which showed that 30% of online shoppers begin their search process on Amazon, with just 13% turning to Google. That means when it comes to searching the internet, Amazon leaves Google in the dust. Major food brands don’t think about SEO currently, Entrepreneur points out. Buying habits are ingrained in the consumer based on what they see on the shelves, not what their company website looks like or because the brand was surfaced to them by internet search.
Democratic Changes, or a Leg-Up for Monied Brands?
What remains to be seen is not if Amazon will have an impact on the organic foods market, but how. It could democratize the grocery shopping world, giving smaller upstart or local brands more of a chance to compete with their national counterparts. On the other hand, some are worried it could create a system that elevates the larger brands and further dooms products with smaller marketing budgets to e-shelf obscurity.
Amazon has already experimented with grocery concepts of its own with Amazon Go, which enables in-store shoppers to add products to a virtual shopping cart via an app, all without waiting in a checkout line. Its high-profile acquisition of Whole Foods is without a doubt leading to… something, and until the food industry knows exactly what Amazon’s grand plans are, there will undoubtedly be board rooms in corporate offices around the world with marketers furiously scribbling potential scenarios and action plans on whiteboards.