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Whole Foods Case Analysis

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Whole Foods Case Analysis
Whole Foods Markets’ sales have been in decline since last year due to intrusion from mainstream and specialty grocers. Whole Foods plans to revive its growth by starting a lower-priced chain aimed at millennials in 2016. These stores will be called 365 By Whole Foods Market and will concentrate on the sale of its private label inside a smaller footprint, and provide a technology-infused shopping experience. It is my opinion that the creation of Whole Foods 365 is a strategic blunder because (1) it is not appropriately meeting the needs of millennials and (2) it is losing focus.

When discussing 365, John Mackey Co-CEO of WF referred to it as a “chain for millennials” yet it seems to have miscalculated the needs and wants of this market. Mackay says 365 will be more focused on value, convenience, and technology than traditional Whole Foods markets however upon examination 365 does not deliver. As for value: A price review by the LA Times found that 365 produce is generally …show more content…
When analyzed, top retailers around the country have grown to massive sizes by focusing on one core concept and doing it very well. Take Starbucks for example; the company is worth over $80 billion and it has grown to its huge size by focusing on premium hot beverages in the high-end market. Prior to Starbucks, there was no demand for a $5 cup of coffee. Starbucks was successful because it created an experience for the consumer and created demand.

It is my opinion that WF 365 will ultimately cannibalize the sales of WF which are already in decline. While 365 was established to combat Trader Joe's, Sprouts and similar vendors, I believe 365 will only add to the pricing pressure for Whole Foods. With the creation of the 365 brand, Whole Foods is acknowledging that the main brand is too
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