Question

Define the generic business level strategy used by Whole Foods Market. Explain who is the target customer, what the customer need is, and what distinctive competencies the firm has in order to satisfy the customer need.

Explain the importance of the mission and culture at Whole Foods Market: how are they aligned with the business strategy used by the firm?

What is the rationale behind the merger between Amazon and Whole Foods Market? What challenges does the combined firm have?

Answer 1

Whole foods market has successfully implemented differentiation as a business level strategy in which they sell Organic and Natural food products to people through brick and mortar stores. Competitive advantage of Whole foods is the result of differentiation. Whole foods distinguishes them from the traditional food products by selling only organic, fresh and natural food products in the market.

Target customers of Whole Foods and their need -

Whole Foods targets certain people at higher income level who are interested in fitness and wellness and want food which is in completely natural or organic state.

Competencies of the firm -

The firm is competent to market and sell only completely organic food products from its stores. Whole foods thrive for the good health of its customers and the higher income level customers are the ones that whole foods serves. With these products, they make sure that the clients are satisfied and delighted.

Mission of the Whole foods market and its connection with the business level strategy -

Whole Foods is considered to be an excellency in the quality foods market. They aim to set the standards for the food industry. Quality is considered as the core value for the customers. Whole foods' business strategy to differentiate through quality and the type of food products they sell perfectly matches with the mission statement of the company. Whole foods thrives to bring the quality to its customers. As a result, customers need not worry about the product they purchase from a Whole Foods Store.

Why Amazon + Whole Foods?

Amazon is an e-commerce market place which sells almost everything in just a click to its customers. The customers may include anyone or everyone from a group of people as they have products available for customers of all segments on its website.

At the time, Amazon and Whole Foods merged, Amazon was not selling the groceries on its website and Grocery selling was a completely new concept for the e-commerce. On one hand, Amazon was a completely virtual market place for the sellers and customers and while on the other hand, Whole foods was a set of Brick and Mortar stores to sell organic groceries to people through stores. Then, what brought amazon to buy Whole Foods?

Well, Amazon wanted to diversify into selling the groceries and Whole Foods is an excellent way to understand the consumer behavior for groceries. Also, Whole Foods was a profit generating company. Amazon had the chance to promote its Prime membership through the Whole Foods store and was a win-win situation from both the sides.

Hence,

1. It was a full fledged deal for Amazon to enter the groceries stores.

2. It gave an infrastructural boost to amazon by providing them the stores and a well established business in groceries.

3. Through discounts at whole foods to prime members, Amazon got a chance to promote its prime membership to the customers.

4. With this deal, Amazon got the set of stores that would improve its supplyu chain in US, UK and Canada. They were able to sell the applicable products through websites also.