Get Latest Business News from All Over the World 24/7 throughout the Year: I shopped at Amazon Fresh to see why it's struggling. I found hyped discounts, odd displays, and bad coffee.

Insider reporter Alex Bitter stands outside an Amazon Fresh grocery store in Maryland. — Amazon Fresh has operated grocery stores for three years, but the chain has yet to win over many shoppers.
Alex Bitter/Insider

It's been three years since Amazon introduced Amazon Fresh, its second chain of supermarkets.
But the stores haven't caught on with consumers, leading Amazon to make some changes.
I visited an Amazon Fresh store in Maryland to see what might be rubbing consumers the wrong way.

Expanding its grocery business has been a goal of Amazon's for years. But it's proving to be a tough nut to crack, even for one of the biggest names in retail.

The latest example of that challenge came in early August, when Amazon said it would revamp some of its Amazon Fresh supermarkets, according to Bloomberg Businessweek. The coming changes include Krispy Kreme donut stands, a wider range of items on shelves, and brighter color schemes for store decor. The chain has also cut back on staff. In July, Amazon Fresh laid off employees at its stores, the Washington Post reported.

August marked three years since Amazon opened the first Fresh store in the US. In that time, Amazon has built a network of 44 Fresh stores, according to its website. But along the way, Amazon has closed some Fresh stores. It has also canceled some Amazon Fresh store openings.

I decided to visit one near my home in Washington, DC to see what Amazon had spent the last three years building — and whether I could see myself shopping there on a weekly basis.

"Our goal is to build a best-in-class grocery shopping experience where Amazon is people's first choice for selection, value, and convenience," Molly McWhinnie, Amazon spokesperson, told Insider.

"While the largest brick and mortar grocery retailers in the U.S. and globally have operated for a half century or more, it's still just Day 1 for us, and we remain committed because we believe when we find the right mix of offerings for customers we'll be able to make their lives even easier," McWhinnie said.

Are you an Amazon Fresh employee with a story idea to share? Reach out to this reporter at abitter@insider.com

I went to an Amazon Fresh location in Chevy Chase, Maryland, right on the border between Maryland and DC.

The entrance to an Amazon Fresh store in the Friendship Heights neighborhood on the border of Chevy Chase, Maryland and Washington DC. — Alex Bitter/Insider

This particular store opened in August 2021 and was among the first Amazon Fresh stores in the same metro area as Amazon's HQ2, which is across the Potomac in Arlington, Virginia.

I immediately saw these two ads plugging deals at this store.

One touted cheap baguettes, while the other gave me Costco vibes with its promise of a whole roast chicken for under $5.

This particular store is half a block away from a Metro station and several bus routes, as well as just off of busy Wisconsin Avenue.

That means it's easy to get to and sees a lot of commuters looking for groceries on their way home.

It's also across the street from a Whole Foods, the other Amazon-owned grocery chain.

A Whole Foods supermarket just off of Wisconsin Avenue in Washington, DC. — Alex Bitter/Insider

The area is a great example of how much competition Amazon Fresh faces: Within a 10-minute drive of this store, you can find two Whole Foods stores, Wegmans, Giant, Safeway, Target, a local neighborhood market, and a planned location for German discount grocer Lidl.

Technically, I went in the side entrance, which required going up these stairs to get to the store itself.

Stairs at the entrance to an Amazon Fresh store in Chevy Chase, Maryland. — Alex Bitter/Insider

This was the entrance nearest to the Metro stop, so lots of people use it.

Around back was the main entrance, which was more welcoming.

The main entrance doesn't face a major street, though there is a sign on a nearby busy roadway directing shoppers to the store.

There are seven spots reserved for curbside pickup at this Amazon Fresh store.

The signage also suggested that Amazon Flex drivers can also use these stalls.

After walking up the stairs inside of the side entrance, I saw this bank of self-checkout kiosks.

Amazon is reportedly adding self-checkout kiosks to some Fresh stores after years of trying to get shoppers to use its Just Walk Out technology.

I also saw these packs of bottled water.

Packs of 24 bottles of water wrapped in plastic sit in a display at Amazon Fresh. A sign indicates each pack costs $2.99. — Alex Bitter/Insider

They were sold under the Happy Belly brand, one of several Amazon store brands that I encountered on this trip.

There was also brand-name water sitting right next to it.

It wasn't clear how much these packs of Nestlé water were.

In what would become a theme of this shopping trip, I noticed a bright "Sale" sticker on this cooler.

Inside the cooler were packs of chicken breasts.

Nearby were these pre-packaged beef burger patties.

Each one had a "30% off" sticker attached, making them just under $4 a pack.

Good thing there was so much packaged meat: These cases for meat and seafood were completely empty.

I remember seeing meat in these cases last time I came to this store several months ago.

On many of the end caps were more "Sale" signs.

At most grocery stores, end caps are prime real estate that brands use to promote new products or special deals. At Amazon Fresh, though, they seemed like regular old shelf space.

Not all of them were well-stocked or contained a logical mix of products.

This end cap contained a mishmash of chips, soda, and crackers.

Some of the end caps were mostly empty.

Maybe the sale went well and they just couldn't restock fast enough?

Other parts of the store were better-stocked, such as the baby diaper section.

There were products from big names like Pampers as well as those from newer brands like The Honest Co.

Some of the sales weren't what they first appeared to be.

Boxes of Kraft Macaroni and Cheese sit on the shelf at an Amazon Fresh store in Maryland. — Alex Bitter/Insider

From a distance, these boxes of mac n' cheese appeared to be two for $4.

A closer look revealed a lower price on the shelf tags than the one indicated on the big sign above.

Four boxes of Kraft Mac & Cheese sit on a shelf at an Amazon Fresh store in Maryland. — Alex Bitter/Insider

The shelf tag suggested that these were just $1 each, not $2.

There were also ads on the wall for Amazon's own-brand products.

This ad for Aplenty chips was in the baking aisle, for some reason.

I also saw this TV that was playing ads for name brands like Tostitos.

It seemed odd to me to have ads playing on a TV in a supermarket instead of, say, those brands putting up flashy displays of their products.

As I looked around, I noticed more sales and discounts than the last time I visited this store.

These Amazon-brand kettle chips, for instance, were $1.99, down from $3.49.

There were discounts on both Amazon-branded products as well as name-brand ones.

These packs of La Croix sparkling water were marked down to $3.09 each from $4.39.

One thing I needed to buy was oat milk, so I headed to the dairy section.

The milk selection was similar to what you'd find in a regular supermarket.

Next to the milk, I found this kiosk where you could ask Alexa for help.

This is an in-store version of Amazon's home assistant.

You could ask Alexa about sales in the store, or even where the bathroom is.

A screen at an Amazon Fresh store prompts customers to ask Alexa where the bathroom is. — Alex Bitter/Insider

I didn't need one, but it's an often-overlooked amenity in most grocery stores.

I found a few different kinds of oat milk and made my choice.

There was a much larger selection of almond milk, including an Amazon brand.

On my way out of the milk section, I walked by this freezer full of Whole Foods-branded ice cream.

This was one of several items from Whole Food's 365 brand that I noticed in this Amazon Fresh store.

I found more signage promoting low prices as I moved into the produce section.

This sign advertised two pounds of bananas for 99 cents.

Most basic produce was well-stocked.

There were plenty of bananas, though these ones weren't free like the bananas across the river at HQ2 in Arlington.

There was plenty of seasonal fruit.

With fall approaching, Amazon Fresh already had a robust selection of apples.

But some of the signage in the produce section needed updating.

Spring was long gone by the time I saw this sign during my late August visit.

I picked up an eggplant after being tempted by the price cut.

Fresh eggplants were marked down to 99 cents a pound from $1.99.

Next to the produce selection was a lane for those using Amazon's Dash carts.

Most people I saw in this store were using regular carts or baskets, but two or three were using Dash carts.

Dash carts require you to log in using a QR code from the Amazon app.

Once logged in, customers can place items directly in the cart, which identifies what they are and keeps track of which products they've selected. The cart automatically charges a customer's Amazon account at the end of the trip.

This Amazon Fresh location appeared to have the older version of the Dash cart. Amazon unveiled an updated model last year with more space for purchases, Supermarket News reported at the time.

Not far from the Dash cart lane was this customer service counter.

If you don't feel like shopping in a store, you can always order groceries and pick them up here.

There were also these pickup lockers for Amazon purchases, and to the right, a kiosk for returning items.

Amazon can ship your order to a locker like this one as an alternative to delivering it to your home.

But the returns kiosk was full when I walked by.

During my half-hour visit, I noticed two people stop by this kiosk carrying an Amazon box, suggesting that this is a popular service at this location.

As I moved toward self-checkout, I saw plenty of prepared foods.

This hot bar reminded me a bit of Whole Foods.

There was also space for the roast chickens I had seen advertised outside, but unfortunately, there weren't any to buy.

An empty heated shelf with a sign above it reading "Roasted Chicken, $4.97" — Alex Bitter/Insider

My plans to compare Amazon Fresh's roast chicken with one from Costco were foiled.

There was space for a selection of hot sandwiches, but those were also not available.

I was visiting the store just after 2 p.m. on a weekday, so it's possible it was wiped out from the lunch rush.

I decided to pick up a mid-afternoon snack to test out some of the prepared food offerings, starting with this espresso machine.

I opted for a small beverage, which cost $1.49.

After a few taps on this screen, I got it to dispense a mocha.

This espresso machine gave me plenty of beverage choices, from espresso drinks to chai teas.

I also decided to pick up a slice of pizza.

I bought a single slice just to try it out.

With groceries and a snack in hand, it was time to check out.

I opted to use one of the self-checkout stations near the side entrance.

The self-checkout looked pretty standard, aside from a couple additions.

On the right side of the card reader was a device to read your palm in case you were paying using Amazon One. There was also a small refrigerator with sodas, which you could place your groceries on top of before checking out.

With checkout done, it was time to try the pizza and mocha.

A piece of pizza and a mocha in a disposable cup sit on a bench outside an Amazon Fresh store in Maryland. — Alex Bitter/Insider

It was a sunny day, so I decided to sit outside.

The pizza had flavor, but the crust was dry.

I wouldn't rush back for another slice, but it wasn't awful, either.

The mocha was worse: It barely tasted like anything.

I couldn't taste any coffee, so into the trash it went after a couple sips.

Overall, the pizza and mocha weren't the satisfying snack I had hoped for.

A lot of grocery stores are expanding their ready-to-eat meal selections to compete with restaurants, according to the Wall Street Journal.

But between the sub-par items I tried and products like the roast chicken being unavailable, it seems like Amazon Fresh's prepared food offerings need work.

I probably won't be shopping regularly at Amazon Fresh based on my visit there.

Amazon has definitely stepped up its discounts at this Fresh store since the last time I visited. But I can find similar deals at stores where I already shop, and those stores generally have a wider selection of items and do a better job of keeping things in stock.

Overall, I don't see any clear advantages to shopping at Amazon Fresh as opposed to other grocery stores in the area.

Whole Foods is known for its quality standards, but what is Amazon Fresh known for? As one Los Angeles shopper told Bloomberg in August: "It just feels soulless."

Maybe that will change once Amazon revamps more Fresh stores.

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Monday 4 September 2023

I shopped at Amazon Fresh to see why it's struggling. I found hyped discounts, odd displays, and bad coffee.

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