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Business

Amazon goes into battle with UK supermarkets

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Business

Amazon goes into battle with UK supermarkets

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COMING UP:Amazon goes into battle with UK supermarkets

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00:00:01
>> This is what the UK's big supermarkets have been dreading, Amazon on Thursday launching fresh food deliveries in the country. It's aiming to grab part of a booming market, UK online food shopping expecting to double to over 17 billion pounds a year by 2020. The Amazon Fresh service just a trial for now and confined to parts of London.
00:00:24
But Reuters' Retail Correspondent James Davey says it could become a big player.>> What it is is a signal of intent from Amazon that it's serious about the online grocery market in the UK. So, the analysts have been doing their sums today and they think that if they roll out Amazon Fresh across the UK and it's successful, the addressable market I saw from one analyst, they're saying could be up to 13% of the UK food market.
00:00:50
So in time, they're a very significant threat.>> Amazon's arrival in the market comes at a tough time for the supermarkets. They're already fighting a price war sparked by discount rivals Aldi and Lidl. That has sapped profits across the sector, but it may also have helped the grocers prepare for battle.
00:01:08
>> It's much more profitable for the store, for the retailers, for customers to visit their stores than if they do it online. So, make their stores more attractive, improved product availability, improved customer service, do a lot of the things that they're already doing to counter the threat of a discount.
00:01:25
>> Supermarkets hope point card programs will also give customers a reason to stay loyal, but Amazon has a history of disrupting every market it enters. Thursday’s launch may just be an initial skirmish, but battle has commenced.