The Ripple Effect of Supermarket Wars
Aldi is more likely to respond to any strategic actions that Amazon may initiate through whole foods because it wants to maintain its customer base in the US. The acquisition of whole foods by Amazon will likely change various areas in the grocery industry. One of the areas that will likely be affected is pricing. Amazon will roll-out in whole food stores by reducing its prices so that it tries to attract as many customers as possible. This pricing pressure will affect Aldi in such a way that it will need to deal with the quality of its products so that it is higher and sell it at an affordable price (Wells, 2017). Aldi will respond to the involvement of Amazon in e-commerce by raising its stake in online shopping. It is because, before the acquisition of whole foods, Amazon had little involvement in e-commerce.
On the other hand, Amazon will also respond to any strategic action that Aldi will take. For instance, the funneling of money into online marketing by Aldi will force Amazon to open more stores in the US and diversify them so that they are easily accessible. The intentions of Aldi opening 2500 US stores by 2020 will likely make Walmart and Costco take some strategic actions to counter the move. Walmart and Costco will focus on cost type of leadership in a competitive environment in that they focus on a specific product and later lower the prices. This strategic move will be a hit in gaining customer popularity to ensure that they make maximum sales. When a business company has customer popularity, it is likely to increase its sales in each financial year (LaMarco, 2019)
References
LaMarco, N. (2019). Competitive Business Strategies. Small Business – Chron.com. Retrieved 16 July 2020, from https://smallbusiness.chron.com/competitive-business-strategies-4623.html.
Wells, J. (2017). Six ways the Amazon-Whole Foods deal could impact the grocery industry. Grocery Dive. Retrieved 16 July 2020, from https://www.grocerydive.com/news/grocery–6-ways-the-amazon-whole-foods-deal-could-impact-the-grocery-industry/534975/.