Amazon and Whole Foods: Project Management Data Points

Amazon and Whole Foods: Project Management Data Points
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What are the key assets of Whole Foods…and is the plethora of data points the primary asset of interest to Amazon? Here are some key questions to consider:

  1. Is the existing and potential data at Whole Foods worth more than the data at other grocery chains?
  2. Is the value of Whole Foods data enhanced when combined with Amazon data and digital systems?
  3. Can the data assets resulting from the merger provide an advantage in the race for dominance in the grocery delivery and pickup business?

Existing and Potential Data

For #1, Whole Foods does have some unique data advantages. It has broad distribution around the US, whereas most other competitors are regional. It specializes in a unique niche of the grocery industry, which may provide more valuable data points but which may also exclude a key part of the market.

However, it is positive that they specialize in the high end of the market. This will provide an advantage in developing the competency where there are higher margins, with the potential to continue to develop one market share has been secured.

Enhanced Value

For #2, it is likely that the Whole Foods data assets can be enhanced by Amazon data and technology. While other chains could also enjoy enhanced value, Amazon’s capabilities and deep pockets give this merger an advantage. One key area of expertise is distribution, where Amazon brings to the table a strong command of the distribution chain. The question is whether they will be able to leverage that in the grocery business, and the Whole Foods store s network gives it a good chance.

Data Assets

For #3, it is likely that the data assets resulting from the merger can provide a competitive advantage in the emerging grocery delivery and pickup business. Amazon has developed businesses across most consumer retail products through its online competency. It has a strong advantage in being able to apply this to the grocery segment. It recognizes the uniqueness of the grocery market and the need for substantial brick and mortar assets – something that is not as critical in most other product segments.

In acquiring Whole Foods, Amazon does acquire valuable data points, which are likely enhanced in value when combined with Amazon’s proven expertise and existing digital assets. However, the risk is tempered by the potential for Amazon to help Whole Foods to reduce costs and become more cost competitive, which has hampered performance in recent years.

This post is part of the series: Food Fight: Amazon/Whole Foods Merger Project Management

This is a series of four articles on disruptive strategic projects from the Amazon-Whole Foods merger.

  1. Amazon - Whole Foods Merger: What Disruptive Strategic Projects Result?
  2. Amazon - Whole Foods Merger: Whole Foods Stores as Data Points
  3. Amazon - Whole Foods Merger: Whole Foods Stores as Delivery Points
  4. Amazon - Whole Foods Merger: What Are the Conflicts?