Amazon’s latest grocery push focuses on enticing Prime members to shop at Whole Foods with cash back. Amazon announced that Prime members using the company’s Rewards Visa card will now get 5 percent back on Whole Foods purchases. The new rewards are in addition to the card’s existing rewards for eligible Prime members, which include 5 percent back on Amazon.com purchases; 2 percent back on restaurant, gas station, and drugstore purchases; and 1 percent back on everything else.
You don’t have to be a Prime member to be approved for Amazon’s Rewards Visa, but it pays if you are. Non-Prime members will get only 3 percent back on Whole Foods purchases under the new plan, which is the same as the 3 percent back those cardmembers get on Amazon.com purchases already.
This is the first time Amazon extended its 5 percent back perk to a retailer aside from Amazon. This could persuade Prime members who are also cardholders to shop at Whole Foods more. Since Amazon’s purchase of the supermarket chain last year, it has been trying to encourage more people (especially Prime members) to shop at the grocer. Amazon slashed some Whole Foods’ prices almost immediately after the acquisition, and recently the company expanded its Prime Now two-hour delivery to include Whole Foods items in a few markets.
Amazon is hoping discounts, cash back benefits, and speedy delivery times will encourage Prime members to make all of their grocery purchases at Whole Foods. Amazon may be an online retail giant, but the grocery market is difficult to break into and even more difficult to dominate. The acquisition of Whole Foods helps Amazon by providing more brick-and-mortar locations than the company had before, as many customers still prefer to purchase groceries at a local store. While Amazon has online shopping down to a science, it may have to offer just as many in-store perks as online perks to lure more customers to Whole Foods.