Amazon Expand Grocery Offering to Sell Iceland Products

It has been announced that Amazon and Iceland will soon be in partnership which will bolster its already growing Amazon Fresh business with Iceland joining the retailer mix of COOP and Morrisons. We can expect this will be a complementary growth opportunity which will also help Amazon gain additional data within the grocery category.

What does this mean for Amazon?

With this change Amazon have broadened their range with a particular focus on frozen foods with Iceland selling the likes of Greggs, TGI Friday, Harry Ramsdens and My Protein frozen foods amongst many others. This not only builds on the selection of foods with some recognisable brands but also targets a different demographic through a current customer base of high to mid price point supermarkets such as COOP and Morrisons. This means that Amazon will be able to reach consumers who eat frozen foods more often, whether they are financially conscious consumers or large families where time and convenience are extremely important.

We could imagine this may also drive loyal Iceland customers to Amazon for convenience with time.

What does this mean for consumers?

Broadly, there will be a greater selection of products on site albeit a complimentary focus on frozen foods which may have not been as much of a focus for Amazon to date. We can recognise that Amazon shoppers are often associated with having a convenience focused trait, this may be a winner for those with limited time that want quick alternatives to the lengths that preparing meals can take.

What does it mean for brands?

There are some positives and negatives to take from this situation, Amazon clearly still have their focus set on building their grocery business. The partnership will likely bring in an additional customer based that may shop for frozen foods and may also shop for brands in and out of the category. The negative for grocery brands could be the increase in competition. Due to Amazon being a marketplace, they are always striving to have the most diverse range of products to suit everyone's needs, this may only increase competition in time which may impact sales for brands that have been in the category for some time.

Time will tell whether the partnership between Amazon and Iceland will be a success. Regardless, both businesses will learn a lot and bolster their collective sales through the Amazon Fresh business. If you need support launching your FMCG products on Amazon, please reach out and one of the Tambo team will be able to help.

Joe Farley, Associate Director & Head of Consultancy