How The Amazon-Whole Foods Deal Changed The Grocery Industry

Amazon bought Whole Foods one year ago. At the time of the deal, which came as the grocer was under pressure from activist investor Jana Partners, Whole Foods was struggling.
It had been first to the specialty and organic game, but as larger competitors also moved into the space, it was ceding ground. With scale and better infrastructure, these retailers could offer many of the same products at a better price. Whole Foods was behind its competitors in technology and developing a loyalty program.
Its challenges showed through in its finances. In 2017, before its sale to Amazon, same-store sales were declining 1.5 percent, according to regulatory filings. The previous year, they were declining 2.5 percent.
The deal between the two - which was at one point known as Project Athena - came together under intense secrecy, after Whole Foods CEO John Mackey reached out to Amazon CEO Jeff Bezos through an industry consultant. Amazon told Whole Foods if word of the deal leaked, it would call it off.
A year later, here's where we are.
» Subscribe to CNBC: cnb.cx/SubscribeCNBC
About CNBC: From 'Wall Street' to 'Main Street' to award winning original documentaries and Reality TV series, CNBC has you covered. Experience special sneak peeks of your favorite shows, exclusive video and more.
Connect with CNBC News Online
Get the latest news: www.cnbc.com/
Find CNBC News on Facebook: cnb.cx/LikeCNBC
Follow CNBC News on Twitter: cnb.cx/FollowCNBC
Follow CNBC News on Google+: cnb.cx/PlusCNBC
Follow CNBC News on Instagram: cnb.cx/InstagramCNBC
How The Amazon-Whole Foods Deal Changed The Grocery Industry | CNBC

[@alexcardona4424]

I'm surprised you didn't cover the part where Amazon extinguish the part-time workers health benefits that work at Whole Foods

[@donnaterry85]

I have stopped shopping at whole foods due to their new Amazon policy. Customers are no longer allowed to bring in their own containers for the bulk section.

[@lemonade2473]

Grocery delivery might actually help our roads and traffic. There's less cars if one car delivers to multiple houses. Also less plastic bags if items are placed in recyclable cardboard boxes, or better yet two boxes that are switched whenever you have delivery. So when they deliver a new box of food, they also take back the empty one that you used last time. Rinse and repeat.

[@zeroproof8723]

Amazon is streamlining Wholefoods vendors, in a bad way. Small local vendors are getting squeezed out. They are making it so basically if the vendors are not picked up by one of the top distribution centers they will not be available. GMO labeling that was set to begin in a couple months has been killed. The standards Whole Foods was built on are slowly disappearing. They literally have taken down the core value signs that are suppose to represent WF's.

[@quadsnipershotp1lvl4]

But how many Whole Foods are there compared to Walmart, target, and Kroger? Still not that many it’s expanding but I still say price is an issue for a ton of people. Then the people that shop at Walmart are not the type of people to show at Whole Foods.

[@laurenelizabeth2592]

My local coop was worried but wholefoods has driven me harder to the coop. I know who makes my foods and where my produce is coming from.

[@user-lx1ks8bl7l]

Creepy! I mean you know websites track your browsing but recording your physical transactions AND your credit card at a physical store where you might not be aware of, is just creepy.

[@orionl6304]

Pretending this wasn’t already happening is just ignorant.

[@nothing-wp9ti]

recording this information is required. it's how credit card transactions work

[@neonlost]

This always happens when you shop anywhere online or in person.. Amazon is just skipping the middle man by not having to buy that info from a 3rd party that bought it from the stores.

[@williamnaman3570]

The prepared food is much worse. No chicken breast, only thighs. Four cheese Mac became prison Mac. Security guards have been removed even though there was a shooting at a nearby wfm. Local relationships with vendors are over. Low salt items removed and replaced with chips with 5 different oils. Less of a grocery than a Amazon store. The management didn't even know they used to make raisin challah for the holidays. If you don't preserve the knowledge of a grocery chain, you destroy it. It took decades to build this business. I was a safer way customer. They need to turn this around before they lose all their local customers.

[@PhaseSkater]

She keeps slurring her words. Sounds like stans sister from South Park.

[@eeeyooohoh]

LMAAAOOOOO.

[@kulbirsingh4997]

That voice hurt my ears

[@tapabratachakraborty523]

Sounds like a teenage American chick

[@yunyiguo6849]

I am sorry but I feel exactly the same way.

[@fourthgirl]

I don't shop at WF because I can't afford it. Besides I'd rather shop at local Berkeley Bowl, Farmer Joe's with a sprinkle of Trader Joe's.

[@aurum12hm70]

Whole foods stopped being whole foods. It lost its value on what made it unique. If it's going to become like any other grocery store, why pay a premium?

[@anonymoushuman8443]

Hi I'm from the future. Amazon kicked Instacart to the curb and now uses their own employees for grocery delivery.

[@danzuck8936]

These are real concerns. Weakening of locality relationships for corporate-wide efficiency may be counter to Whole Foods historical heart and good goals😥

[@truth135]

Good info but I don't like the voice

[@552mustang]

Matthew Young Ditzy millennial b-tch vocal fry :-D

[@EastofVictoriaPark]

I just found out about this. I just thought she had braces.

[@leilah486]

I rather go to our farmer's markets

[@notavegan4722]

Matthew Young you should cry about it.

[@JayCookanator]

Nothing's wrong with it I didn't notice anything wrong with the narrators voice.

[@sfcallstar]

😂😂😂 didnt even notice the speech impediment until i read the comments now i cant unhear it why would they hire her lol willy willy

[@oliverjohn5566]

A harlem girl trying to sound like from Soho

[@charlesscott27]

Two neighborhoods that you most likely have never been to.

[@Naturenerd1000]

This isn't Whole Foods anymore. It's really sad. Not shopping there any more.

[@billytoit]

Three times the couple leaving the store... 🙄

[@alotofmore]

Okay but why is this soundtrack badass lol😊

[@kevtheman7226]

Amazons eventually gonna have a monopoly on everything

[@Red-hy2wp]

Smh I can perfectly understand the narrator

[@1DJSkittles]

They went down hill now

[@espojason8812]

Local whole foods near me doesn't have any of this

[@SevenDeMagnus]

It's good to be able to do and buy big things.

[@dysfunctionalchaos5739]

You to a point are right that Albertsons bought plated, but Albertsons is owned by a third party company. This company (cerberus) ownes several different grocer's such as Safeway, acme, amigos, Carr's, heggan, Jewel Co., Etc. Therefore Albertsons itself did not buy, but cerberus baught.

[@CG-jq5vu]

It’s true.. all of it. (I quit Whole Foods a month ago)

[@danabram]

Lol no one in the office wanted to tell her her voice was bad.

[@user-fj1em6tf9p]

They changed / ruined the hot food service departments. Popular dishes are gone - the department looks asleep and unkept. Only the produce and seafood departments look excellent.

[@espojason8812]

Didn't realize how annoying her voice was till I read the comments. Can't unhear it now grrrr

[@trampfossil]

Amazon needs to make Whole foods 100% Organic there are enough non organic foods out there,,, Do Something AMAZING AMAZON!!!!

[@chansaicommerce1721]

AWESOME

[@wwlee5]

so what makes Whole Foods different from other groceries???

[@loveharrydaily]

Walter S. As the name suggests... they only sell organic stuff.

[@biancahotca3244]

Nothing!!! Just the ridiculously high prices

[@angelsaidferreira5193]

cute employees 💁‍♀️

[@ProfessionalTycoons]

Man technology is really one of key factors in economy.

[@hi-nw7qy]

Ayy, I remember Plated

[@BryanFerris-saffronsnail]

Buying a company doesn't give you it's authenticity, it takes away theirs...

[@AJ-jt4ti]

Turn volume off , captions enabled

[@DistantDeadWorlds]

4. Is a lie. I’m a shopper, and they don’t have the data upto date. They don’t know what is out of stock.

[@robertlamb759]

They need electronic checkout. Most cashiers at Whole Foods stores are unprofessional. Just my experience compared with other retailers.

[@kelseycoca]

I can't deal with the way they say data. It's day-ta! Not datuh! This is very informative, though!

[@florisas.7557]

i have nothing against people with speech impediments, but don't hire them to do the voice on CNBC...

[@thehdynasty]

Oh ma goaad, like, why are you so mean!

[@roberteugenecarter]

Sounds like you do have a bit of an axe to grind here. All of the narration was extremely easy to understand from where I’m sitting. What’s he problem here exactly?

[@ricardo_boutique]

I noticed nothing until reading this, her talking is just fine...

[@AndroidsDontDance]

I have nothing against with how people talk but I'm going to point out how they talk -you

[@praba991ify]

R u a doctor

[@JW-lo1ts]

The Professional shoplifting at Whole Foods is effecting the bottom Line... ..

[@Emadavid]

Are Whole Foods better than Wal-Marts? Price, quality wise?

[@tylerjacobson3169]

De Toa Baja Pal' Mundo wegmans tho

[@orionl6304]

It depends. A lot of the natural and organic brands sold at walmart are typically sold at a higher price point than whole foods. As an overall store Whole Foods is more expensive because they don’t sell cheap ingredients that are terrible for your body. They quality of produce in Whole Foods is better than most conventional and even organic grocers. Since amazon has purchased Whole Foods the price point has definitely gone down a lot especially with the in store brand! I work for Whole Foods and I have watched prices continue to lower and sales on items continue to get better.

[@Emadavid]

Celeste Lewin Thanks, I got a whole food 2 minutes near my house and always drive all the way to the Wal-Mart. I'm gonna give it a try.

[@LeonardoDiax24]

De Toa Baja Pal' Mundo price definitely no, quality yes

[@Emadavid]

Leonardo Diax noted. Quality is more important to me at this point of my life. Thanks.

[@notk4tie95]

Voiceeee oh god

[@keqinyangmuseum6183]

Giving people more information about foods In nutrition. By computers.

[@marycassidy1695]

I'm close t9 Sprouts, King Soopers (kroger), Trader Joe's, Natural Grocer, and soon a Luckys Market. I've almost cut out Whole Foods entirely. Expensive!!! The other stores have sale prices that don't require a $120 year membership.

[@tongkatali7643]

Is the voice robotics English ?

[@samo4real977]

WHOLE FOODS PROFILES - CHAPTER II THE RESPONSE: A Whole Foods Rep reached out with the generic “I am sorry that you had a bad experience at the Foggy Bottom location.”. However, she seemed vague and confused as to why CRIMINAL PROFILING IS NOT OK. When asked about the Security Office being called on me, she fibbed and insinuated that security was making his rounds and just happened to be standing at the top of the EXIT ONLY stairs. The security guard is stationed at the front entrance of the store adjacent to the stairs leading DOWN to the lower level. If he truly was making his rounds (due to the layout of the store) it would have made more sense for him to: 1. Take the stairs to the lower level 2. Walk the lower level 3. Take the stairs to the upper level 4. Walk the upper level 5. Return to his position So, the Whole Foods Rep either: neglected to view the security footage and (to protect Whole Foods) assumed that Security was making his rounds or viewed the security footage and lied to protect Whole Foods. I find this attempt to placate to be amateurish and insulting. WHOLE FOODS - DO BETTER

[@hellohey5955]

I hate how she says data

[@sxxxam]

Same for me TATA

[@ninjanerdstudent6937]

I never go to Whole Foods because the name is a misnomer. They don't actually sell whole foods. They sell expensive processed goods. Processed is the opposite of whole.

[@jaybee27D]

Wait, I didn’t notice anything wrong with her voice, what’s got everyone so angry?

[@Steve_305]

She sounds she could be from the valley

[@jameshero5755]

STOP TRACKING WHAT I BUY!!! wtf "consumer data"

[@storress12]

Whole paycheck

[@Zakariah1971]

End of Whole Foods

[@dividendincome9685]

ALL the comments on here talk about the “voice” but have no idea what this means for stock. Let’s focus on the matter at hand.... so easily distracted smh

[@dividendincome9685]

John Doe not as much as I would’ve liked. It was about 2 years ago I grabbed up some shares of Apple and Amazon. I bought more Apple than I did Amazon, hindsight is 20/20 but I’m still happy with it.

[@Will_Ramb0]

@Doomsday Defense good point, ironic though coming from a sports fan... Sports are meant to distract you and waste your time...

[@bezoozime9170]

Can only take 'amagod' voice for a few seconds

[@YT.Abhinav]

Apple, Amazon, alphabet ....look like A's are winning the battle

[@brownskinlady3202]

How is it pronounced? Data or Data?

[@awakenhawk4056]

Dayta

[@urielbautista7147]

DA DA

[@racypies]

Good luck beating WinCo. Bezoz will need it.

[@camilochaves4771]

Wow, bad reporting from CNBC. The biggest change is they eliminated the chicken tikka massala sandwich from their menu. That basically ruined my life. Thanks Jeff Bezos.

[@NoAnimePD]

Isn't this the same girl that makes all those math videos!?

[@xenonkey7770]

Since Amazon's takeover they have ruined my favorite burritos. They took away all the many tortilla options (spinach or tomato) and just had regular basic kinds. They took away chicken chilli Verde and replaced it with this disgusting blocky bland chicken. Added a bunch of vegan crap no one asked for and often times only offering vegan cheese only. Salsa has changed and often too spicy. Idk if they even do the burrito/sandwich cards anymore. I had enough for one free one but I haven't been back sense I tried their new burritos changes. Trying to be PC and make it a "taqueria" version. Stupid. Will never forgive them for this. Also some of my favorite items I love from there have disappeared like Better Life products, hibiscus tea and maple water. If they discontinue their blueberry vegan donuts I may be out.

[@andrewvangils3112]

Like nails on a chalk board.

[@MACHPhotography]

Hey CNBC, Kroger did not buy Ocado. They have entered into an agreement to build fulfilment centers. That's it.

[@hellokltsz]

it said they invested in it, i believe

[@Joseph1NJ]

Voice? That's what happens when you try to do news on a cartoon channel. The immaturity, minors that is, on YT is overwhelming. Too bad there isn't a YT for adults.

[@Atipat12]

🤣🤣🤣🤣🤣🤣🤣

[@bartlemington2003]

my god did you guys here the way she said data "datuhh" ughh my ears yuck.

[@xxsarah52009xx]

Everybody’s taking about the narrator having a speech impediment but where????????

[@zcvxs]

Never been.... and still can't care

[@TimeforchangeTrudeaumustgoEndb]

I will wear my poppy proud..... If the great wars were lost we wouldn't have our freedom now... So 🖕to anyone who doesn't respect the fallen soldiers or anyone who fought for our freedoms..... Jesus there were kids who faked their ages so they could defend our freedom.....Respect 🙌 God knows times have changed.....

[@lovedev9308]

I shop at whole foods only for certain things like meat and rice. I'm a prime member and in most say it is nice. You feel like a VIP of grocery stores.

[@biancahotca3244]

Don’t shop there for meat and rice. It’s not worth it. It’s wayyy over priced. You can buy organic anywhere now.

[@angelsaidferreira5193]

@@biancahotca3244 amazon shoppers are dangerous ⚠️, I work for whole foods market and I see them all the time in a rush and almost hitting employees and customers 💁‍♀️ . Good that I like to use safety words and a bell 🔔 so they know I’m around

[@shivamdhaliwal6935]

I didn't mind the voice........actually kind of liked it

[@sr9643]

Whole Foods now sucks

[@marcusm975]

I’m good shopping at my HEB.

[@gameranger7957]

Wtf?? What wholefoods is this because Im not seeing any nesquik cereal and lion cereal here.

[@Axeltonn]

The produce quality changed. I get produce that is super close to expiration now and isn't worth buying.

[@tylerjacobson3169]

Wegmans for life

[@dianegonzalez4748]

👀 must be nepotism

[@KreativeKonnection]

It's a disaster. They ruined it

[@zea3647]

karen kapnick agreed

[@lawsonone6015]

Amazon ad

[@shivamdhaliwal6935]

The right tool in the wrong hands............

[@chansaicommerce1721]

HAHAHA !!!!!!!!!!!!!!!

[@USA____]

Duz it Willy?

[@Vvision456]

..

[@mibny69]

Natural NOSE ???

[@loveforthegame3]

All this and they are still half as good as wegmans

[@versus13]

Amazthhhhhhon

[@biancahotca3244]

Whole Foods today since the amazon acquisition has much lower quality foods and services and much, much higher prices, while it is not organic. It’s an organic lie they are selling you is what it is. It’s ridiculously expensive. 60-70 percent more expensive and the quality is much, much less. The hot food is very low quality. It’s more like, “dried out food”. The store, the prices are a big fat non organic joke. You can buy much better quality food and actually organic for more than half of what you buy at Whole Foods at other grocery store.

[@sanchayansarkar2953]

Aldi is better. Organic and affordable.

[@petersampson5202]

I AM VERY PROUD OF JEFF BEZOS AND VERY HAPPY FOR HIM. I WOULD ABSOLUTELY CRY WITH GRATITUDE TO SHOP AT WHOLEFOODS AND TAKE CARE OF MY HEALTH. IT IS ALL A MIRACLE. I CANNOT THANK GOD ENOUGH FOR MY BEAUTIFUL FRIENDS.

[@futuramanut]

Got voice crack?

[@mjbeltran9429]

Do you bite your tongue when you talk?

[@tnnsboy18]

Everytime I go into a Whole Foods, it literally smells like musty hippy people... LMAO hate that place

[@orionl6304]

Hate is a pretty strong word for someone who keeps coming back. Also why hate a company that actually does some good for your community, the earth, our economy and others as well. Hate is a strong word for a company you probably don’t know a whole lot about. You should do some research into the company because they are actually fantastic whether your store smells like hippies or not.

[@tnnsboy18]

Welp the cool part is that we're both entitled to our opinions right? I'll pass in learning more about this gosh awful smelling place. ;)

[@orionl6304]

Lol I’m not trying to sell you on a company just tell you that you don’t understand the concept of hate or you’d never have gone back

[@user-fj1em6tf9p]

Horrible report - lazy reporting and low substance.

[@aldogallegos3209]

I got a headache from this video.

[@zava999]

Food quality get worst.

[@nathanchu759]

Dislike for the voice

[@ext1013]

wholefoods indeed changed...their brisket sucks....it used to melt in your mouth and now, you chew it and spit it....I eat meat only when I want to celebrate and now I am so disappointed. I want to return it but I already paid it and chewed and sput a fourth of it..... i used to love wholefoods....now I AM NOT SUPPORTING WHOLEFOODS ANYMORE....YOUR BRISKET SUCKS......SUCKS.....SUCKS.....

[@samanthamorgan8117]

I hate this narrators voice so much.