Kroger (KR) announced a new corporate mission last week, which could be simply summed up as “Doing everything we can to try and Amazon-proof our business”. The realities are Amazon’s (AMZN) recent acquisition of Whole Foods has the entire grocery segment shaking in its boots, and the Kroger new mission reflects what it see’s as it’s biggest vulnerabilities:
The plan is based on four drivers, from redefining the food and grocery experience and expanding partnerships to developing talent and focusing on social impact. An overarching theme however, will be Kroger’s accelerated commitment to digital and e-commerce efforts, and applying customer data and personalization expertise through its 84.51 customer insights division to even more aspects of the business, including space optimization, pricing and brand growth.
Read Full Article: Kroger Co. outlines new corporate mission |Chain Store Age
E-commerce and data analytics, the two things Amazon does probably better than almost anyone. The challenge for Kroger and other grocers is that they are competing in a low-margin business against a company in Amazon that doesn’t necessarily need to make money on groceries, thanks to its highly profitable Amazon Web Services division. This will be one to watch, to see if Kroger is able to adapt. The good news is that they are at least reacting early. The question we’re going to dig into is whether or not Kroger is actually a customer of Amazon Web Services — if so, Amazon wins no matter what.