Amazon Now's initial impact on supermarket traffic is moderate, with ACI and KR relatively under pressure

Overview

On its second-quarter 2026 earnings call, Amazon stated that sales of grocery and daily essentials grew significantly faster than its other businesses. To assess whether Amazon Now, launched in May, has already affected traditional supermarkets, Goldman Sachs compared weekly year-over-year traffic trends before and after the service launch in four markets: Dallas-Ft Worth, Atlanta, Philadelphia, and Seattle. The results show that the overall impact remains moderate, but ACI and KR experienced slightly greater deceleration in the relevant regions than their respective company-wide trends, while SFM maintained stronger resilience.

Core views

With delivery within 30 minutes, rapid growth in fresh grocery customers, and higher items per order, Amazon Now is strengthening Amazon's competitiveness in the digital grocery market. However, existing traffic data has not yet shown a broad and significant impact on traditional supermarkets. ACI's deceleration in Dallas-Ft Worth was the most pronounced, but approximately 20 new stores opened in that market over the past year, and Aldi, BJ, COST, H-E-B, TGT, Trader Joe's, WMT, as well as ACI, KR, and SFM all expanded, so traffic changes cannot be attributed solely to Amazon Now. In the short term, SFM is relatively better positioned, while ACI and KR need to pay closer attention to competitive pressure in local markets.

Analysis framework

The study uses Amazon Now's launch in May 2026 as the event point and applies Placer.ai weekly year-over-year traffic data to compare the average trends of supermarkets in four launched metropolitan areas across two periods, January to April and May to July, while cross-comparing regional performance with each company's company-wide traffic trend. The study also incorporates local store expansion to identify competitive interference factors beyond Amazon Now.

Methodology notes

• Event studyComparison of traffic trends before and after launch

  Divide the observation window based on Amazon Now's launch timing

  Compare the average year-over-year weekly traffic trends from January to April 2026 and from May to July 2026 to measure the magnitude of change before and after the service launch.

• Cross-sectional comparisonComparison of regional trends and company-wide trends

  Distinguish local market changes from company-wide changes

  Compare the traffic performance of ACI, KR, and SFM in the four markets covered by Amazon Now with their respective company-wide trends to determine whether launched regions showed additional deceleration.

• Competitive attributionMulti-factor competitive environment assessment

  Control for interference from new store supply and competitor expansion

  Incorporate new store growth in Dallas-Ft Worth over the past year and expansion by multiple retailers to avoid directly attributing all traffic changes to Amazon Now.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Amazon.com, Inc. (AMZN)

  Operator of Amazon Now and the source of this competitive impact

  Strengths

  Fresh grocery customer growth is relatively fast, delivery within 30 minutes improves convenience, orders containing fresh items have higher item counts, and market coverage continues to expand.

  Weaknesses

  Only a moderate impact on traditional supermarket traffic is currently observable, and local market data is insufficient to prove that a broad share shift has formed.

  Comparison

  Compared with traditional supermarkets, AMZN has greater advantages in digital channels, delivery speed, and platform traffic, but it still faces mature competitors in offline fresh food experience and local store networks.

  Risks

  Expansion costs, fulfillment economics, service quality, and traditional supermarkets' strengthening of digital delivery capabilities may all limit its competitive effect.

• Albertsons Cos. (ACI)

  Traditional supermarket operator potentially affected by Amazon Now

  Strengths

  Has a mature regional store network and brand presence including Albertsons and Tom Thumb.

  Weaknesses

  Showed the most pronounced traffic deceleration in the sample in Dallas-Ft Worth.

  Comparison

  Compared with KR and SFM, ACI had the weakest post-launch traffic change in Dallas-Ft Worth; compared with its company-wide trend, the deceleration in the relevant regions was also more pronounced.

  Risks

  Traffic diversion from Amazon Now, concentrated local new store openings, and expansion by multiple large retailers may jointly depress traffic.

• Kroger Co. (KR)

  Traditional supermarket operator potentially affected by Amazon Now

  Strengths

  Has a scaled store base and mature grocery operating capabilities.

  Weaknesses

  Traffic deceleration in the four analyzed regions was slightly greater than its company-wide trend.

  Comparison

  The degree of impact was higher than SFM, but the report did not show that its deceleration in Dallas-Ft Worth exceeded ACI's.

  Risks

  Instant delivery competition, growth in local store supply, and price competition may affect traffic and profitability.

• Sprouts Farmers Market Inc. (SFM)

  Comparable supermarket operator in Amazon Now-covered markets

  Strengths

  Was the most resilient in this regional traffic analysis, and its differentiated fresh and healthy food positioning may provide some protection.

  Weaknesses

  Still operates in a competitive environment where Amazon Now and other retailers continue to expand.

  Comparison

  Compared with ACI and KR, SFM's traffic performance after the launch of Amazon Now was more resilient.

  Risks

  If Amazon further enriches its fresh grocery selection and expands the scope of 30-minute delivery, SFM's differentiation advantage may be eroded.

Key data

• Growth in Amazon monthly active fresh grocery customersMore than 50% year to dateReflects accelerating customer penetration of Amazon's digital grocery business.
• Item count of same-day delivery orders containing fresh itemsMore than 3 times on averageCompared with other orders, orders containing fresh items have larger baskets.
• Fresh items among best-selling products on Amazon.com6 of the top 20Shows that fresh food has become an important high-frequency category on the platform.
• Key markets analyzed4Includes Dallas-Ft Worth, Atlanta, Philadelphia, and Seattle.
• ACI traffic deceleration in Dallas-Ft Worth-2.3 percentage pointsAverage year-over-year weekly traffic moved from growth of 1.0% in January to April 2026 to a decline of 1.3% in May to July.
• Dallas-Ft Worth stores as a share of ACI stores4.6%The impact in this region was relatively notable, but its share of ACI's overall store portfolio is limited.
• New stores in Dallas-Ft Worth over the past yearApproximately 20A large number of new store openings may have diverted traffic from existing stores and is an important interference factor beyond Amazon Now.
• New markets added by Amazon Now in the second quarter80Amazon disclosed that its total global market coverage has exceeded 250.

Impact & implications

For traditional supermarkets, Amazon Now has not yet caused a broad traffic shock, but its rapid expansion may gradually raise the competitive threshold for instant delivery, convenience, and digital experience. ACI and KR are more susceptible in certain metropolitan areas to the dual pressures of traffic diversion and increased offline store supply; SFM is currently more resilient. For AMZN, growth in fresh grocery customers, larger order baskets, and broader market coverage help strengthen high-frequency consumption scenarios, but short-term data is not yet sufficient to prove that it has significantly changed the industry's overall share landscape.

Risks

• The study window only covers May to July 2026 after the launch of Amazon Now, making the observation period relatively short.
• Traffic data is a proxy indicator of operating performance and cannot be directly equated with changes in sales, market share, or profit.
• The analysis covers only four metropolitan areas, and the conclusions may not apply to all Amazon Now markets.
• Approximately 20 new store openings in Dallas-Ft Worth and expansion by multiple retailers create significant interference for causal attribution.
• Operating data from Amazon Now's recently added markets has not yet been fully reflected in this analysis.
• Consumer promotions, pricing, seasonality, and changes in store mix may also affect year-over-year traffic trends.

What to watch

• Traffic, order frequency, and fresh grocery customer growth after Amazon Now launches in new markets.
• Whether the traffic gap between ACI and KR in Amazon Now-covered regions and their company-wide trends continues to widen.
• Whether SFM's traffic resilience can be maintained over a longer observation period.
• Whether ACI traffic recovers after the absorption of new stores in Dallas-Ft Worth.
• Unit economics, fulfillment speed, and product availability of Amazon fresh grocery delivery.
• Traditional supermarkets' responses in instant delivery, digital membership, pricing, and store networks.