Note: This article first appeared in Forbes CMO Journal:
https://www.forbes.com/sites/onmarketing/2017/09/11/why-amazons-whole-foods-and-kenmore-partnerships-make-perfect-sense-for-the-brands/#7a80491fdcc2
Much debate has gone on regarding Amazon’s apparent divergent strategies of acquiring Whole Foods and its exclusivity arrangement with Kenmore.
On the one hand, Whole Foods disrupted the grocery business by leading the movement toward fresh choices and a premium atmosphere. On the other hand, Kenmore is a legendary appliance brand that has been in households for generations.
A contemporary brand and an aging brand, one creates experiences and the other durable goods. Conventional thinking would in fact never lead to partnering with both of these brands.
But a more modern approach to marketing and growth recognizes that customer values exist that transcend those traditionally fought in every industry, and in this case, point to another transformational opportunity for Amazon.
Amazon is a lot of things (a technology company, a data company, a fulfillment company and more) but as a retailer it competes in an industry historically focused on price, convenience, service and quality. These certainly remain important but Amazon meets two customer values that cut across all of them.
One dimension of value is the total customer experience. Shopping to quickly find an item that you need, or, browsing to discover something you want, isn’t enough. Easily buying an item with a single click and express checkout or getting it with convenient delivery and pick-up isn’t enough either.
Customers value all facets of shopping and buying and for decades stores, both on and offline, have excelled at providing specific facets of them. But now personal recommendations, deals of the day and 30-minute delivery won’t win alone. Amazon delivers across all of these experiences of purchase engagement to satisfy this new customer expectation.
The second dimension of customer value that Amazon meets is that more then ever, people want things on their own terms. This is where you can now blend, in a matter of moments, a unique equation of what you are willing to pay for and when you are willing to get it. Sometimes you will happily save a few bucks on an item that may be close to its expiration date. Other times you are equally happy to pay more to have something delivered today.
Customer price and value decisions are fluid and expand beyond the standard offers historically found at retailers. Amazon wrote the book, and code, on meeting our own varied, extensive and unique terms.
People value the total customer experience and on their terms. How Amazon uniquely delivers on both dimensions creates a clear fit with both Whole Foods and Kenmore.
Whole Foods has lots of fans and it has grown to be among the largest specialty grocers in the country. But it can be seen as pricey and a bit of a luxury. Amazon can help with price and convenience to better meet customers on their terms.
Kenmore is a beloved brand in over 100 million U.S. homes. But it can only be found at fewer and fewer Sears stores everyday and in increasingly inconvenient locations. Amazon can help make Kenmore easier to get for customers and provide a better shopping and buying experience.
And doing both can help make Amazon grow exponentially.
Amazon is not the world’s largest retailer because it became a better book, electronics, clothing or household goods store. Amazon has experienced transformational growth by appealing to a contemporary view of customer values. So its not just getting into the grocery or appliance business, it is simply finding new ways to deliver what customers already value in Amazon.
