Whole Foods Debuts Permanent Online-Only ‘Dark’ Store

Need to Know

• Whole Foods has opened its first “dark store” in Brooklyn, which will operate as a fulfillment center for orders made by Amazon Prime customers.
• The grocery chain opened temporary online-only stores to meet rising e-commerce demands brought on by COVID-19; the new store is slated to be permanent.
• Whole Foods began planning to open the “dark store” a year ago, well ahead of the coronavirus pandemic.

Analysis

Whole Foods has opened a new brick-and-mortar store in Brooklyn, New York that exists solely to fulfill Whole Foods orders made online by Amazon Prime customers.

The store opening (if it can be called that—it won’t be open to the public) comes just months after Whole Foods temporarily converted six of its locations to online-only centers, to help fulfill a spike in digital orders brought on by the COVID-19 pandemic. Whole Foods’ new Brooklyn location will be permanent: online grocery sales tripled year-over-year for the second quarter, and Whole Foods has hired hundreds of new employees to help support online order fulfillment.

“Whole Foods Market is proud to introduce our first ever, permanent online-only store in Brooklyn, which will allow us to better serve the community and meet the growing demand for grocery delivery,” a Whole Foods spokesperson said. “We have hired hundreds of Whole Foods Market Team Members and other applicants throughout the NYC area, who will be dedicated to preparing orders for grocery delivery, enabling us to reach more customers than ever before.”

The new Brooklyn location looks like a grocery store-warehouse hybrid, with aisles and shelves that can only be accessed by Whole Foods staff (who “shop” them using Whole Foods shopping carts). The store will stock fresh produce as well as dry goods and household supplies.

Despite the new Whole Foods store seeming tailor-made to shopping habits during the pandemic, Amazon—which owns Whole Foods, having purchased the grocer in 2017 for nearly $14 billion—said they’ve been planning the location for more than a year. Amazon Prime users in more than 2,000 US communities are currently able to order from Whole Foods with no delivery fees, and Amazon Prime Rewards Visa cardholders earn 5% cashback on Whole Foods purchases.

Amazon has emerged as one of the leading online grocery retailers during the pandemic: according to a recent survey, 62.6% of consumers said they bought groceries online from Amazon in the past 12 months (13.2% reported having shopped online with Whole Foods Market).