Amazon.com Inc (AMZN.O) and Whole Foods Market are making a surgical strike in the already brutal grocery price war.
On Wednesday, Whole Foods debuted a much-anticipated loyalty program that offers special discounts to Prime customers, including 10 percent off hundreds of sale items and rotating weekly specials such as $10 per pound off wild-caught halibut steaks.
Those perks are available now in Florida and will roll out to all other stores starting this summer. Amazon previously announced free two-hour delivery from Whole Foods stores for members of Prime, its subscription club with fast shipping and video streaming.
The new loyalty strategy will test whether Amazon’s $13.7 billion deal for Whole Foods brings much-feared disruption and an intensified price war to the $800 billion U.S. grocery industry dominated by Walmart Inc (WMT.N) and Kroger Co (KR.N).
Whole Foods, with 463 U.S. stores and roughly 1 percent share of the fragmented U.S. grocery market, has gained momentum since the Amazon merger last summer, Whole Foods co-founder and Chief Executive John Mackey told Reuters.