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Whole Foods, Amazon Expand Prime Now to New Cities

San Francisco, Atlanta launch; permit reportedly granted in Philadelphia

Amazon said on Tuesday that the two-hour free grocery delivery service from Whole Foods Markets stores through its Prime Now app has expanded to new markets in Atlanta and San Francisco—with more markets on the way.

The service provides free delivery for members of Amazon’s Prime loyalty club, utilizing personal shoppers and a delivery fleet in a manner not unlike a concierge service such as Instacart. Prior to Amazon’s acquisition of Whole Foods last summer, Instacart had been the primary facilitator of Whole Foods’ on-demand sales. Prime requires a $99 annual fee, while Instacart and other on-demand services typically charge a monthly, annual or per-delivery fee.

Instacart and Whole Foods are said to still have a business relationship—the latter is an investor in the former and at one time was its biggest single account—but Instacart in recent months has expanded its roster of partner retailers. An Instacart spokesperson wasn’t immediately available for comment.

Amazon, in the meantime, appears to be using delivery and the power of its massive Prime membership as a means to reinforce the link between the newly joined companies, drive sales and serve a customer base demanding convenience. Amazon’s ability to market the service to its Prime base in those cities could test the loyalty of shoppers utilizing other options.

“We’re happy to bring our customers in San Francisco and Atlanta the convenience of free two-hour delivery through Prime Now and access to thousands of natural and organic groceries and locally sourced favorites,”said John Mackey, Whole Foods Market co-founder and CEO, in a statement. “Together, we have already lowered prices on many items, and this offering makes Prime customers’ lives even easier.”

Atlanta and San Francisco join Austin, Dallas, Cincinnati and Virginia Beach markets that debuted the Prime Now service from Whole Foods last month, but more appears to be on the way. The Philadelphia Inquirer reported Tuesday that Amazon Prime has been granted a permit to operate in that city.

Amazon said it intended to expand the offering “across the U.S. in 2018.”

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