Amazon to expand their online grocery offer?

Posted by Daniel Palmer on 2nd February 2009

Amazon, the online retailer renowned for selling DVDs, CDs and books, is looking to the grocery sector to boost sales and ensure they can become a ‘one-stop-shop’.

The e-tailer first launched a grocery offer in the US in 2007 and is set to expand into the UK, according to reports.

Online shopping

In America, their online grocery offer includes over 45,000 non-perishable items and they have begun testing a non-perishable offer in Seattle. And industry sources have told Retail Week that a non-perishable offer in the UK, pitting them up against the likes of Ocado, Tesco, Asda and Sainsbury’s, would be available to their customers before the end of the year.

Nielsen Online analyst, Alex Burmaster, suggested the Amazon grocery launch would capture the attention of the major supermarkets. “Potentially supermarkets should be nervous as the Amazon name is so well known and it is one of the original, old school online brands,” he told Retail Week. “[But] its biggest challenge could be to change the customer mindset on a site renowned for selling books and DVDs.”

Online food retail is steadily gaining traction, but the market share of online as a percentage of total grocery retail sales remains at about 2.5% in the UK and even lower in Australia. Optimism abounds for the future, however, with suggestions it will claim top spot in e-retail (excluding travel) within a decade.