Amazon is shaking up its grocery strategy in a move to “prioritize” its investments.
The company said it has made the “difficult decision” to close its Amazon Go and Amazon Fresh physical stores, converting various locations into Whole Foods Market stores. The decision came after “a careful evaluation of the business and how we can best serve customers.” (Amazon will continue to operate its Fresh online grocery service.)
“While we’ve seen encouraging signals in our Amazon-branded physical grocery stores, we haven’t yet created a truly distinctive customer experience with the right economic model needed for large-scale expansion,” the company wrote in a blog post.
Amazon is not abandoning brick and mortar. It revealed plans to invest in opening more than 100 new Whole Foods Market stores during the next few years. It also is expanding the brand’s smaller store concept, Whole Foods Daily Shop, with plans to open five additional locations by the end of 2026
In addition, the company emphasized it will continue to test new physical store experiences, such as Amazon Grocery, which it launched alongside Whole Foods Market in Chicago, and its “store within a store” concept at the Whole Foods Market store in Plymouth Meeting, Pa. The concept blends Whole Foods Market’s full organic and natural product selection alongside national name-brand groceries and household essentials from Amazon.
“These experiences make it easier for customers to shop our extensive grocery selection, all in one place,” the company said in its blog post.
Amazon also cited its plans to develop a “mass physical store format that brings customers distinctive selection, value and convenience.” It recently received approval from local officials to build its first big-box store in the Chicago suburb of Village Park.
