...and while we're talking about Amazon and Whole Foods...

...a few thoughts that weren't necessarily pertinent to today's Lunch Date column that I still wanted to collect:

  • It's now clear that Amazon Books, the brick-and-mortar bookstore Amazon built in University Village, was the trial run for Amazon buying some national retailer like Whole Foods. They wanted to get a handle on signage and displays and all the other practical elements of physical retailing before buying into a real-world sales environment.

  • The signage in Whole Foods now definitely resembles the signage at Amazon Books. It's not as enthusiastic as the signage you'll find in other grocery stores, and that makes it interesting. It may only be a matter of time before we see signs over displays of turnips referring to customer data, the way Amazon Books proudly displays bestseller ranks on their marketing materials.

  • Like the Amazon site, there are sales that follow you around the store at Whole Foods. Last weekend, for instance, all Kleen Kanteen water bottles were 50 percent off. As you walked around the store, you'd encounter signs for Kleen Kanteen displays, directing you to different places. Clearly, the Kleen Kanteen deal was a loss-leader — something ridiculously attractive to draw you inside the space and keep you hunting around. Amazon is most definitely applying their online sales philosophy to the physical spaces. And I bet it works really well.

  • We're very likely to see some widescale experimentation in the grocery space, and I bet every other grocery chain is sending employees into nearby Whole Foods to keep an eye on them. Expect to see every chain — not just the high-end grocery stores — start to emulate Whole Foods.

  • I think the next thing we'll see from the big chain stores is an attempt to shake off their unionized employees, claiming that the cost of competing with Amazon is too high to pay union wages. (Amazon was probably interested in Whole Foods in part because they're not unionized.) If unions know what's good for them, they'll argue that it's their expertise and customer service that's keeping non-Amazon grocery stores afloat. Amazon isn't interested in the Whole Foods workforce; they've demonstrated in the way they treat warehouse pickers that they believe ground-level employees are disposable chattel. Grocery stores should respond to the threat of Whole Food by paying their employees more, not less, and making sure their employees are better at their jobs than Whole Foods employees.

  • I would advise other grocery stores to keep the bookstore model in mind. The bookstores that are still around after Amazon are around because they're very good at what they do: they're attractive and interesting places to visit, and they provide experiences that Amazon can never duplicate. Put it this way: Amazon isn't going to put PCC and other quality region-specific retailers out of business, the same way Amazon couldn't put Elliott Bay Book Company out of business. But Safeway and QFC and other large chains, if they try to out-cheap Amazon by cutting corners on labor and variety, are very likely to go the way of Borders and Books-a-Million.

  • Do not doubt that this is war. Amazon doesn't get into a space unless they plan to dominate that space. Sometimes they make mistakes. (See the Fire Phone for the best example of an Amazon failure.) Most times, they don't.