Will Whole Foods draw more Prime shoppers with one-hour curbside pickup?

Photo: Amazon
Oct 21, 2020

Whole Foods announced today that free, one-hour grocery pickup is now available at all of its U.S. locations to Amazon Prime members.

The service will include the very same mainstay and seasonal items popular at the chain’s stores and is available for orders of $35 or more. Prime members can access the service through the Amazon app. Once they fill a basket, customers select a one-hour pickup window and check-in using the app once again.

The Amazon-owned grocery chain has, in many ways, been a laggard when it comes to curbside pickup adoption. A recent study published by Ipsos found that Sam’s Club and Kroger offered the most effective curbside pickup programs in grocery. Sam’s offered pickup parking spots at all the clubs audited by the research firm, and Kroger had orders ready on time 97 percent of the time. Whole Foods claims that the majority of customers who check in prior to arriving have their orders brought out to them within one minute of parking in the store lot.

In testing its service, Whole Foods found that 40 percent of all orders were placed by first-time customers. The grocer believes that pickup will only continue to grow as a means for customers to order and collect their purchases. A company press release cites Global Data Research, which found 68 percent of consumers plan to continue using curbside pickup even after the pandemic has passed.

Whole Foods sees the pickup service as a complement to the free-two hour home deliveries it currently offers to Prime members via Amazon Fresh. For an even larger product selection, Prime members can find electronics, household products, toys and other items in addition to grocery, also with free two-hour delivery, using Amazon Fresh, as well.

One potential logistical stumbling block for Whole Foods’ new service is traffic in stores created by Prime workers as they fill online orders for customers. Business Insider reported last month that associates and managers often found Prime shoppers to be a disruptive force in stores. One manager referred to them as “vultures” who “come in and pick every department clean” before the store opens to its walk-in customers.

DISCUSSION QUESTIONS: Do you expect Whole Foods’ curbside pickup program to be successful in attracting more Prime members to shop at the grocery chain?  What do you see as the upsides and potential concerns around the program as its launches chainwide?

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26 Comments on "Will Whole Foods draw more Prime shoppers with one-hour curbside pickup?"

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Mark Ryski

This new curbside pickup program will draw Prime members to Whole Foods. However drawing customers is one thing, delivering an excellent experience is another. It is vital that Whole Foods executes this well, as shoppers’ tolerance for a poor curbside experience is low given the other alternatives available. The key upside for Whole Foods is attracting new customers; the downside is the risk of poor execution turning customers off.

Neil Saunders

I have no doubt that this service will be popular and used by many consumers. The concern, however, is how stores cope with fulfilling the orders. Many Whole Foods stores are already crammed with workers picking and packing orders. Some stores have makeshift fulfillment centers in lobbies and entrances. This could well make things worse. In the push for digital, Whole Foods must not forget that the customer experience for those making the effort to visit physical shops is very important. Unfortunately, that aspect seems to have been neglected of late.

Camille P. Schuster, PhD.

I agree. Getting banged and pushed out of the way by employees trying to fill orders quickly is not a good experience for in-store shoppers.

Brett Busconi
1 year 1 month ago

I do expect it will be a success for them — provided they address the quality issues they are widely reported to have experienced over the last year, even pre-pandemic.

Concerns are around the quality and the accuracy of the order picking. Do a good job picking the correct produce and matching the right products with the orders and people will embrace the one-hour pickup. Additional concern might be, what happens in rush time? It’s easy to schedule a 10 a.m. pickup perhaps, but what about at 5 p.m.?

Gary Sankary

I think this will be popular with Prime customers. At the same time it exacerbates the capacity bottleneck that has been a problem at other grocers. If my next available appointment for pick up is in three days, am I willing to wait? Grocery tends to be a need it now sort of product. If anyone can solve this issue it’s Amazon.

Raj B. Shroff

I believe that the press around Whole Foods adding curbside and them adding the “one-hour” component will put Whole Foods on the radar of Prime members who don’t already shop Whole Foods.

I think the upside is the press and the learning Whole Foods will get. The downside would be if they couldn’t consistently meet the one-hour promise. Another concern, mentioned in the article, is the traffic created and experience disrupted by pickers and packers. I would imagine Amazon’s next step is doing a half fulfillment warehouse/half store concept under one roof.

Lisa Goller

So smart. Prompt curbside pickup will make Whole Foods more alluring to upscale Prime members in time for Thanksgiving.

This program gives Amazon a more robust grocery strategy and differentiates Whole Foods with efficiency to attract more shoppers. If Whole Foods consistently meets consumers’ expectations of speed, the brand will steal market share from grocery rivals this holiday season.

Matt Cebulski

It will drive more Prime members to try the service but even Amazon is not immune to the complications (shorting items, sub-ing items, and having pickers compete with customers) that come with the store-fulfillment model in e-commerce grocery. It will be interesting to see how they manage important issues like slot capacity and if they turn to any other technologies (i.e in store micro-fulfillment) to help give customers (both in-store and online) the best experience.

Ed Rosenbaum

We have friends who have become outside pickup shoppers. Most grocery chains/stores have outside pickup as part of their COVID-19 existence. It will continue after the pandemic subsides. But I have doubts about significantly more Prime shoppers taking advantage of it. It is a convenience now only because of the pandemic. As an example, retired seniors who are able to get out often use grocery shopping as their means of seeing other people and being in public. I do not see them giving this up as long as their health allows them to continue doing their own shopping.

Brandon Rael

Curbside pickup and flexible fulfillment options have been emerging pre-COVID-19, and have picked up significant momentum during the pandemic. While at the surface this appears to be a no-brainer, by shifting your operating model to meet the needs of a changing consumer base, curbside pickup and BOPIS is a far more complex consideration. The success of this initiative will come down to excellence in execution, as well as consistency.

Whole Foods and other grocery stores are already faced with store operations challenges, as they are dealing with aisles of customers, Instacart and Prime shoppers, and simply keeping up with the surging consumer demand. In particular, several Whole Foods have repurposed their dining in area for online order fulfillment.

This is where there is a significant opportunity for fully dedicated dark stores to meet the surging demand for digital orders. By shifting curbside pickup to these locations, this would relieve the congestion in many of the stores and ensure a consistent experience.

Lee Peterson

As an avid Whole Foods customer (just ask Neil), I will tell you what this program does do for sure: ruin the in-store experience. “My” Whole Foods was a test store for the one-hour pick up, so if you’re also a fan get ready for this: a wiped-out storefront that gets turned into a warehouse, literally dozens of “pickers” clogging the aisles, exasperated employees attempting to restock, a wipe out of any food service up front and an incredibly jammed parking lot. It’s one thing to go ahead and create this service, but at ALL costs to the shopper? This kind of transition needs to be thought out, planned and even run by the city for permitting to create an add-on facility perhaps. The way it was done here just showed me that Amazon has a LOT to learn about physical retail.

Perry Kramer

Whole Foods/Amazon is continuing to find synergies that will deliver increased customer satisfaction and improved shopping experience if done correctly. Whole Foods and most grocers are experimenting with ways to move the most common products to some type of staging area to minimize people “picking” during store hours. As an complimentary effort many grocery chains are using a scheduling process to establish a maximum number of pickups each hour thus limiting the number of “pickers” in the store. Similar to the Prime concept, other grocery chains are giving priority pickup times to customers who are part of their loyalty program. Bottom line, if done properly, the one-hour pick up has customer demand and will be seen as a value add and a customer retention tool.

Ryan Mathews

So I guess the question is, from a consumer’s point of view, which is the more attractive value proposition: sit at home and have your groceries delivered to you, free within two hours; or, drive yourself to the store and get them in one? I’m not sure what the answer is. If you are paying a premium to be a Prime member, why shouldn’t you have things delivered right to you? The quick answer is that pickup gives you more scheduling flexibility, but it also requires more effort. But on balance I agree with others here that “net-net” curbside pickup will attract for Prime members to Whole Foods and maybe even convert some folks to become Prime members. The only other real question is, given the labor and in-store traffic limitations will that be a good or bad thing?

Shelley E. Kohan

Whole Foods’ curbside pickup is a grand slam for the company. Prime membership continues to grow with initiatives centered around convenience. This year more than half of the U.S. population will be Prime members (over 142 million). Shoppers that love Whole Foods do not like the typically crowded in-store environments and jammed parking lots – curbside addresses both issues. Additionally, the new initiative will bring a younger customer to shop Whole Foods who are used to such conveniences. The big concerns are logistics on execution as many sites have small parking areas to manage this process and the ability to keep in stock of high demand goods.

Steve Montgomery

My expectation is curbside will convert far more existing Whole Foods customers to that method of getting their order than it will generate new ones.

Camille P. Schuster, PhD.

This program will appeal to Prime members who live near a Whole Foods store. Those who like Whole Foods, have wanted to try Whole Foods, and want to get out of the house will find this to be an attractive option. If you have never shopped at Whole Foods I am not sure the attraction of the store is obvious without ever having been inside one of the stores.

Shep Hyken

VERY SMART! One-hour pickup for Prime members. First, Prime members will appreciate the service. Second, those who aren’t Prime members may want to join.

Doug Garnett

The world is so cluttered with various “Prime” programs I can’t see this as anything significant. In part, Amazon needs to worry about how the older idea of being “special” with a Prime membership is so quickly decaying into a green stamp book of “rewards” — but without a good catalog for guidance.

Ricardo Belmar

In a rare moment, Amazon is playing catch-up to other grocery stores. But in typical Amazon fashion, they move quickly to address a customer need — convenience — by providing curbside pickup in an hour.

I have no doubt Prime members will jump at this opportunity. The question is, what impact will this have on shoppers who want to go into the store for their groceries? Reports of crowded Whole Foods with empty shelves due to Prime pickers may get worse instead of better. However, what if this is the convenience factor that migrates many of those in-store shoppers to curbside? That could provide a winning combination for Amazon and may even lead to their opening more dark stores to service digital orders for Whole Foods.

The one area that remains murky — how does all this fit into their broader grocery plan with their new Amazon Fresh formats?

Kai Clarke

Yes, yes, yes. This is larger, more convenient, and costs nothing more with your Amazon prime membership. This will drive more people to purchase more Amazon prime subscriptions and increase the appeal of Amazon on all fronts.

Kim DeCarlis

New norms continue to be driven by the pandemic and curbside pickup is one of them. But it will take more to attract Prime members to the chain: product selection and price being chief amongst them. The availability of convenient pick up times will also be key.

Since the beginning of the pandemic, record numbers of grocery and food delivery apps have been downloaded, and securing a delivery time has become a key challenge. In fact, browser extensions have been introduced for the sole purpose of finding coveted delivery times, and convenient pick up times will likely be next.

It’s important to note that extensions can drag malware or malicious scripts along with them.

In order to be successful, it will be imperative for Whole Foods to offer a broad selection of pick up times and to instrument their app to protect against malicious extensions that steal customer data and sully the experience they are trying to create.

Craig Sundstrom

Will it draw more people? Of course. Every service offered does. So the real questions are 1) will it make money, and if not how much will it lose? And 2) given the story a few weeks back about the disruptions caused by hired-shoppers, will this make things even worse?

This is Amazon, so the first question is probably academic, but I’m interested in hearing opinions on the second: I thought the issue was a tempest-in-a-handbasket first go ’round, but few seemed to agree … I would think they’d be even more upset now.

John Karolefski

I am sure the new program will be successful. But this whole issue of speedier delivery or pick-up is getting to be a bit absurd. I’m sure some company will start promoting curb-side pick up in 45 minutes and that will make headlines. Some grocery shoppers are busy-busy-busy, and demand super quick service. Maybe those folks should reevaluate their lives.

Natalie Walkley

This will be popular with Prime shoppers, especially those who are not in geographic regions of Prime Now (2-hour delivery). However, given the specialty-type groceries at Whole Foods, I would be curious that this is successful as a “new” customer expansion move, versus a current-customer adoption move. (I.e. Maybe more current prime customers use it than new signups.) I don’t think they’ll struggle with picking orders and curbside, as they obviously have a lot of intelligence in that area and will bring their fulfillment knowledge to Whole Foods curbs. 😉

Karen Wong

Another free Prime benefit — it’s hard to see how it won’t be popular with existing members. What intrigues me is why Amazon is choosing to implement it with in-store shoppers. Surely it would be better to re-design the stores to reduce the in-store space with SKU rationalization and expand the back of store into a dark store-like experience for their own or 3rd party pickers?

It’s a better experience for walk-in shoppers who wouldn’t have to battle with professional shoppers, and cheaper to re-stock without the need for merchandising. It would be even faster for those picking orders since warehouse best practices could be applied. I understand it when smaller merchants or those in lower-turn sectors stock or directly fulfill from shelf, but if shelves are being picked clean before walk-in customers come in, they’re going to end up with a dark store anyway.

Casey Craig

Amazon’s partnership with Whole Foods is a great example of a digital and brick-and-mortar partnership. It creates opportunities for both companies to increase sales and engagement. The use of curbside pickup has played a vital role for retailers during the pandemic and I think it will only increase in popularity even after things start to return to “normal.”

"Whole Foods/Amazon is continuing to find synergies that will deliver increased customer satisfaction and improved shopping experience if done correctly."

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