Amazon's rumoured Ocado talks show growing ambition for AmazonFresh

Reports surfaced last week that Amazon was in secret talks with grocery delivery service Ocado. Does the speculation foreshadow an imminent UK launch AmazonFresh?

AmazonFresh: is it headed to the UK sooner than expected?
AmazonFresh: is it headed to the UK sooner than expected?

For some industry analysts, a deal between Ocado and Amazon would be of huge benefit to the latter.

A tie-up would allow Amazon to tap into the online supermarket’s distribution, grocery sourcing and logistics network, moving it out of the realms of dabbling and into the arena of serious grocery retailers.Ocado

While reports have yet to be substantiated, Amazon’s grocery aspirations are no secret.

Amazon's next-day grocery delivery service, Amazon Fresh, arrived in the US nearly a decade ago.

In November last year, the retailer announced that its Pantry service, which lets consumers stock up on essentials, would be available in the UK.

Marketing charts the rise of Amazon’s grocery aspirations.

August 2007

AmazonFresh makes its worldwide debut in a suburb of its US hometown of Seattle. The invitation-only beta test began extending beyond the boundaries of Mercer Island and into other suburban areas, including Kirkland.

June 2013

AmazonFresh makes its way down North America’s West Coast to Los Angeles, offering consumers free same-day delivery on orders over $35.

A few months later, in December, the service goes live in San Francisco, while the following year sees AmazonFresh target shoppers in San Diego, areas of New York City and in Center City in Philadelphia.

October 2015

Amazon makes it a requirement to pay an annual $299 membership fee to use Fresh in Seattle and other areas.

September 2015

Amazon UK begins testing demand for a full grocery service, adding a range of about 60 chilled and frozen food items to its Prime Now one-hour delivery service, which operates in Birmingham and London.

November 2015Amazon Pantry

Amazon makes Amazon Pantry available to UK Prime members, allowing them to fill a box with 20kg of groceries from a list of 4000 items including food, drink and household supplies.

January 2016

Rumours re-emerge that Amazon is to hook up with Ocado, fuelling speculation surrounding the 2016 launch of its AmazonFresh service in the UK. The fact that Amazon’s UK operation is looking to hire another 2500 staff has further fanned the flames.

However, to date, Amazon’s impact on online grocery has been modest. In Seattle, where it commands 40% of online groceries, its share of total (online and offline) grocery sales is just 1.2% according to Conlumino analysts.

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