NEW YORK – Amazon is bringing its speedy delivery to Whole Foods.
The online retail giant plans to roll out two-hour delivery at the organic grocer this year to those who pay for Amazon's $99-a-year Prime membership. It is the company's biggest — and most expected — move since it bought the organic grocer last year.
Right after taking over Whole Foods, Amazon made a splash by cutting prices on bananas, yogurt and other items. It also began selling Kindle e-readers in some of its 470 stores, and started selling Whole Foods-branded food on its site.
But rivals have been preparing for the day Amazon — with the Prime program that's been very successful in cementing customer loyalty — would expand grocery delivery at Whole Foods.
Walmart, the country's largest grocer, is making it easier for customers to order groceries online and pick them up at the store. Target bought grocery-delivery company Shipt late last year. Kroger, the nation's largest supermarket chain, has been promoting store pickup for online orders and doing trials of home delivery.
One of the biggest hurdles for the growth of grocery delivery is that many people want to pick out their own eggs or fruit, said Darren Seifer, a food and beverage industry analyst at NPD Group.
"There are always going to be people who want their bananas a little green," he said.
Amazon.com Inc. said deliveries started Thursday in Austin, Texas; Cincinnati; Dallas; and Virginia Beach, Virginia. The service will expand nationwide this year. The company declined where it would grow, but its Prime Now service is in more than 30 cities, including Chicago, Milwaukee and San Diego.
Shoppers will be able to order meat, seafood and other grocery items through Amazon's Prime Now app and website. Items will be pulled from Whole Foods stores, bagged and then delivered by Amazon drivers. Amazon, based in Seattle, said there's no extra fee for two-hour deliveries above $35, but one-hour delivery will cost $8.
The announcement gives Amazon yet another way to get groceries to customer's doorsteps.
It already does so through AmazonFresh, but that requires a $15-a-month fee. And Prime Now delivers groceries from its facilities, but it has also offered grocery delivery from other physical stores, including Whole Foods rival Sprouts Farmers Market.
Whole Foods also already offers delivery in some cities through a partnership with delivery service Instacart, which will continue.