Two weeks after Amazon announced its acquisition of Whole Foods for almost $14 billion, the assessments of what this deal means for retail and food industries are still rolling in. Some predictions have been rather dystopian, with visions of robots replacing cashiers a popular scenario – one that may be true, though Bloomberg sees this as occurring within warehouses, not at the checkout stand. Or perhaps Amazon’s founder and CEO, Jeff Bezos, wants to “take control of the physical world as well as the digital one” as he merges online and brick-and-mortar retail.
On the lighter side, one needs to roll into an older location in Los Angeles or New York, see what a mess some of these more cramped locations have become, and assume Amazon’s technology can help Whole Foods wake up out of its recent doldrums. In the view of Forbes, we can put our MBA hats and see how Whole Foods’ locations can become testing laboratories for Amazon’s new business ideas – while the grocery chain can help the Seattle tech giant crack the one nut it has not conquered, online supermarket shopping.
But according to the co-CEOs of the organization Conscious Capitalism, the Amazon-Whole Foods marriage is a huge step forward for purpose-driven business. If Bezos will step back and let Whole Foods’ co-founder and CEO John Mackey (who has penned a book outlining his vision of capitalism) continue to nurture the grocers’ culture, this new entity can actually help capitalism become a force for good:
“Whether through acquisition, partnerships or emulation, we envision a future in which the more businesses practice Conscious Capitalism the more opportunities the philosophy will have to influence and impact otherwise less conscious businesses. And with more conscious businesses in the world, the more capitalism will be viewed as the force for good we know it has the potential to be when practiced consciously.” - Alexander McCobin & Doug Rauch, co-CEOs of Conscious Capitalism.
A similar batch of mixed messages also holds true for Whole Foods. Once largely applauded for making organic foods and personal care products mainstream, in recent years the company has been jeered for being a hipster “Whole Paycheck” cliché from its asparagus water and pre-peeled oranges embarrassment to its description as “America’s Temple of Pseudoscience” as mocked by the Daily Beast. And when it comes to more substantial matters, Mackey has been painted as anti-labor and anti-union; others questioned Whole Foods’ commitment to social responsibility with allegations of prison labor within the company's supply chain.
Overall, however, McCobin and Rauch are forgiving of Mackey, insisting that he now has the opportunity to cajole Bezos and Amazon’s top executives to adopt some of the grocers’ conscious capitalism business practices.
So could Amazon join a roster of top brands, which includes REI, Starbucks, Costco, and Southwest Airlines, which McCobin and Rauch herald as examples of companies that have made public commitments to become more “conscious” corporate leaders? When announcing the Amazon acquisition to Whole Foods employees, Mackey lavished praise on Amazon for its eschewing of short-term Wall Street expectations in favor of long term strategic thinking. That approach, which once confounded many analysts, has certainly paid off for Amazon, which a few weeks ago witnessed its stock price surpass $1,000 a share.
The question is whether Amazon will either pick Whole Foods apart until it is unrecognizable – the fear many of the supermarket chain’s fans share - or build upon the grocer’s successful 20-year track record. Odds are that Bezos and Amazon will tilt towards the latter. One just needs to look at Bezos’ four-year-old acquisition of the Washington Post: once a proud newspaper that fell into rapid decline, the Post has enjoyed a resurgence and is one of the best U.S.-based print and digital news sites.
Whole Foods could benefit from an analogous makeover, as Amazon’s technology gurus find ways to improve its overall performance. Whole Foods' locations, meanwhile, could become laboratories for Amazon's new services and ideas. If the results include more rewarding job opportunities, more healthful food options at an even more competitive price and most importantly, if Amazon embeds some of Whole Foods’ more admirable values within its operations, this deal could be a big win for more responsible capitalism after all. As of now, however, those if’s are quite big as a skeptical public still tries to adapt to retail’s new reality.
Image credit: Ines Hegedus-Garcia/Flickr
Leon Kaye has written for TriplePundit since 2010, and became its Executive Editor in 2018. He's based in Fresno, CA, from where he happily explores California’s stellar Central Coast and the national parks in the Sierra Nevadas. He's worked an lived in South Korea, the United Arab Emirates and Uruguay, and has traveled to over 70 countries. He's an alum of the University of Maryland, Baltimore County and the University of Southern California.