Although Whole Foods stock has dropped today because of one key metric—the comparable store sales—there are a couple of exciting things happening at the company.
This quarter, Whole Foods launched its first 365 store, its millennial-focused store concept with lower prices. It was received positively: Basket sizes were larger, the store attracted a larger demographic base, and it drew many more customers than expected.
Whole Foods is learning from that experience as it opens up 20 more stores:
• One interesting question is whether the 365 stores will cannibalize the traditional Whole Foods stores. As Whole Foods opens its third store, the company will be able to scrutinize this more closely: The new 365 store will be close to a regular Whole Foods store.
• Unlike Whole Foods, 365 stores don’t have buyers; all inventory replenishment is automated. The system unfolded successfully and it has resulted in major savings for the company.
• In the next quarter, Whole Foods is beta-testing a new rewards program that will give customers personalized rewards based on their shopping history.