Amazon is consolidating its grocery brands into a $5-and-under essentials line, betting that value staples can attract cost-conscious shoppers and finally give it traction in the notoriously low margin grocery business.
Amazon debuted Amazon Grocery, merging Amazon Fresh and Happy Belly private labels into one cohesive essentials collection, a Wednesday report said.
The line features 1,000+ items, from produce and meat to snacks and pantry staples, with most products priced under $5 and rated 4 stars or higher.
Amazon’s private label sales rose 15 percent year-over-year in 2024, signaling stronger demand for its in-house brands as consumers navigate an annual inflation rate of 2.9%.
New offerings include bakery cinnamon rolls, pizza dough, lemonade, and bottled water, with deli meats, canned beans, and frozen vegetables coming soon.
Mike Daher, Deloitte’s U.S. consumer industry leader, said: “Consumers feel they're paying more but getting less. From June 2022's peak inflation, through today, consumer belief that they are paying fair prices and getting a good value has decreased by 61% and 30% on average, respectively, and it doesn’t seem to be recovering. Looking at grocery specifically, in May 2025, only 32% of consumers say they get high value out of a typical bag of groceries. This is pushing more consumers towards value-seeking.”
Amazon has struggled to crack groceries since it bought Whole Foods for $13.7 billion in 2017, while Walmart and Costco still dominate through scale in revenue, locations, and consumer spend. Its newest move, Amazon Grocery, bets on private-label goods, akin to Walmart’s Great Value or Costco’s Kirkland Signature, a segment surging as inflation drives consumers toward value. Store-brand sales reached a record $271 billion in 2024, up $9 billion from the prior year and more than $51 billion, or 23.6 percent, since 2020, according to PLMA.
$234.6 billion. That’s how much Amazon founder, Jeff Bezos, is worth, making him the fourth richest person in the world.