Amazon outdoes rivals on grocery pricing

Monday, October 19, 2015 - 13:24 by Graham Miller

Amazon has only just launched its Fresh grocery delivery service in the UK, serving a limited number of customers in Birmingham and London, but already there is speculation about the potential for the online retailer to outdo its established supermarket rivals. And now it appears that one of its key weapons in the food sector is price, according to a City AM report.

Analysts looked at the cost of a typical shopping basket on some of the most popular items that are available on both Amazon and Ocado. And perhaps unsurprisingly, it was the former that came out on top, by a significant margin.

On everything from milk and butter to Coca-Cola and crisps, Amazon’s prices were less expensive than its competitor. And while Ocado is an upmarket grocery delivery firm with close ties to Waitrose, the fact that it has been so roundly outdone by Amazon is impossible to ignore.

People who choose to carry out safe shopping online with Amazon when placing a grocery order via the Fresh service, could save around 20 per cent based on this particular report. And while the authors were keen to point out that this is not a definitive study but an early assessment, there is no doubting that Amazon’s entry into the grocery delivery market will have major repercussions.

The biggest problem for Amazon at the moment is actually being able to supply customers with the wide range of products that they are used to being able to order via safe shopping online from the UK’s supermarkets. And, in some instances, common items are not available whatsoever, or only on offer as part of bulk orders.

Once Amazon Fresh is launched nationally, UK consumers will at least have one more option for their weekly food shop.