Amazon Fresh price cuts drive consumer spending | Making ends meet

Amazon Fresh has joined the growing ranks of retailers that are cutting prices. It lowers the prices of thousands of grocery items to encourage price-conscious shoppers to add more items to their cart.

The online grocery delivery company, which also operates several brick-and-mortar stores, says its U.S. customers will see discounts of up to 30% on 4,000 items in stores and online every day, with markdowns changing weekly.

Major retailers are offering summer deals to attract shoppers tired of inflation

Major retailers increase discounts during the summer months.

In recent weeks, many large retailers, including Target and Walmart, have lowered their prices in an effort to attract consumers to stores and online so they can spend more freely on both basic purchases such as food and more discretionary purchases such as new clothes , decorative items for children. home, arts and crafts or hobby kits.

Retailers are on edge after raising prices as inflation soared in recent years. But now households aren’t shopping like they used to, and high prices are forcing Americans to choose between wants and needs. In the game of chicken between stores and shoppers, stores seem to finally give in.

This is a problem not only of individual customers or even large retail chains, but of the entire American economy, about two-thirds of which comes from consumer spending.

Shoppers have been retreating for a year now as costs have risen 20% to 30% from three years ago and revenues haven’t kept pace, said Sarah Wyeth, managing director of retail and consumer at S&P Global Ratings.

This has consumers of all income levels looking for deals. “Consumers simply have fewer dollars to spend,” Wyeth said. She added that the challenge for retailers now is to awaken consumers from a frugal mindset.

What’s getting cheaper on Amazon Fresh

The price cuts include meat, seafood, frozen foods, dairy and cheese, beverages, snacks and pasta, the retailer told CNN on Friday. Discounted groceries will include national brands and Amazon’s (AMZN) private label products.

“Expanding our weekly deals on thousands of products and expanding the reach of Prime Savings on Amazon Fresh is just one of the ways we continue to invest in competitive pricing and savings for all our customers – both in stores and online” – Claire Peters, global vice president Amazon Fresh, said in a statement.

For Prime members, Amazon Fresh offers more savings by offering 10% off hundreds of groceries online.

Competitors are cutting too

This week, Target dropped prices on more than 1,500 popular items, from butter to laundry detergent, in an attempt to attract more shoppers.

It said Target (TGT) customers can expect “thousands more price reductions” – up to 5,000 items – to be reduced over the summer, with the lower prices intended to “collectively save consumers millions of dollars” on household staples and everyday items, such as milk, fresh fruit, diapers and even pet food.

Last week, Walmart ( WMT ) said it had cut prices on nearly 7,000 items in its stores, saying it was seeing deflation in some key grocery items.

Budget grocers Aldi and furniture and home furnishings retailer Ikea have also recently cut prices.