Amazonfresh: Attract and Convert Costumers

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-According to Forbes magazine, to offer an excellent user-experience and drive sales for your brand, your digital presence must be engaging. Engaging with your customers is going to help to convert them and to come back to your site.

References:

Shaoolian, G. (2016, Oct 31). How Amazon Fresh and Fresh Direct are competing to engage users online and generate brand loyalty. Retrieved from https://www.forbes.com/sites/gabrielshaoolian/2016/10/31/how-amazon-fresh-and-freshdirect-are-competing-to-engage-users-online-and-generate-brand-loyalty/#6e62e53c7960

Zaroban, S. (2015, June 25). Amazon Prime members convert 74% of the time. Retrieved from https://www.internetretailer.com/2015/06/25/amazon-prime-members-convert-74-time

Retain Strategy

In the past two years (2014 & 2015), Amazon grocery shoppers have increased on average of 26% year-over-year every quarter, according to Cowen data. For comparison, Walmart purchasers have declined 3% year-over-year on average, while grocery shoppers at Target have declined by about 1%.

Amazon remains to be the “go-to” site for consumers buying grocery products online, even with all of the new online providers. In late 2013, BMC research showed that 39% of consumers who bought groceries online had bought groceries from Amazon; that percentage has grown to more than 50% by 2015 when Prime Pantry and Prime Now are included.

Amazon is growing its share of grocery spending by offering different ways to do “less than a complete shop” online – via making it easier for Prime members to buy more grocery products.

Therefore, Amazon doesn’t need to take on the challenges of serving the complete shopping trip. All they should do is get the growing legions of Prime members to see the advantage of buying a few more grocery items via Pantry.

With Amazon Fresh targeting less price conscious ‘time-starved' consumers, we suggest the following recommendations to continue retaining loyal members –

-Keep same day delivery strategy for loyal customers.

-Enable an annual subscription fee to help customers use the service more frequently to get their money’s worth.

-Provide loyal customers with the flexibility to sell their membership for limited use with new users resulting in more word of mouth publicity of Amazon’s great experience online.

As per recent statistics in December’2016 - Amazon is ahead of some rivals on its ability to retain customers. More than half of its customers ordered again within 30 days of their first order in January through October, outpacing competitors Peapod and Instacart. Only FreshDirect led Amazon with a 58% retention rate.

Therefore, AmazonFresh remains to be one of the most competitive online-grocery stores. This sector hasn’t been fully explored and comes with many challenges and many unknowns. As time goes by, many new start-ups are appearing and will be appearing using the same tactics that have made AmazonFresh so successful. The tool AmazonFresh needs to have in order to fight the competitive pressures from startups is to constantly fine-tune and innovate its business plan. If done correctly, AmazonFresh will always have a competitive advantage for attracting customers because it is an extension of Amazon who has a very large network of customers. AmazonFresh needs to reinforce and promote its commercial offer to convert customers from competitors. But, overall, Amazon is one of the successful companies today and has been the first to create a profitable online-grocery store.

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