Amazon's new grocery line woos customers with lower prices

Amazon recently launched a private-label grocery line with lower prices, an obvious response to rising food prices. Amazon Grocery unites the Happy Belly and Amazon Fresh brands and includes more than 1,000 items, most of which cost less than USD $5. Available products include meat, fresh produce, snacks, dairy and more. 

"With Amazon Grocery, we're simplifying how customers discover and shop our extensive private label food selection while maintaining the quality and value our customers expect and deserve," said Jason Buechel, vice president of Amazon Worldwide Grocery Stores and chief executive officer (CEO) at Whole Foods Market, according to a press release. "During a time when consumers are particularly price-conscious, Amazon Grocery delivers more than 1,000 quality grocery items across all categories that don't compromise on quality or taste – from fresh food items to crave-worthy snacks and pantry essentials – all at low, competitive prices that help customers stretch their grocery budgets further."

Amazon filling a need with lower prices for groceries

This announcement comes as US consumers demonstrate they are jittery about their budgets. CNBC reports that the Conference Board’s consumer confidence index hit 94.2, off 3.6 points from the August reading and below the Dow Jones estimate for 96.0. In addition, August 2025 saw the biggest jump in grocery prices in almost 3 years, according to NPR. Indeed, grocery prices are up 29 percent since February 2020, according to the Bureau of Labor Statistics. 

"We're not going hungry," Shelia Fields, a retired nurse who lives in Galveston, Texas, told NPR. "We just have anxiety over this. And anxiety about our kids and our grandkids. … We've been through a lot of recessions. We've been through one in the '80s and 2008. And this is the scaredest we've ever been."

Pricing as part of CX

One of the challenges of delivering an exceptional customer experience (CX) is fair pricing. Stubborn inflation and tariffs on imported items like bananas and coffee are impacting the price of food. In addition, a crackdown on immigration has translated into fewer laborers to pick and process food that is sold in grocery stores, which is also contributing to higher costs. 

During the last presidential campaign, the cost of groceries was a flashpoint. Many political analysts credit these high prices for Donald J. Trump's win over Kamala Harris. In fact, the price of eggs was a political football, and Trump promised to lower prices on day one of his administration. Prices for eggs are up 10.9 percent, according to Axios. And in a Harris/Axios Vibes survey of 2,093 US adults, 47 percent of respondents said groceries are harder to afford now than one year ago in Septemeber 2024. 

Reducing anxiety for consumers

Supermarkets must reconsider their CX strategy amid these price hikes. NPR cited the Associated Press and NORC report, which included the following findings:

"The cost of groceries has become a major source of stress for just over half of all Americans, outpacing rent, healthcare and student debt." And NPR shares that the Kroger supermarket chain has admitted that the stress is "apparent as shoppers make smaller, more frequent trips to the store, use more coupons and opt for cheaper private-label products." 

Amazon Grocery is meeting a growing demand, offering low-cost groceries that have shifted from a customer wish to a customer necessity.

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