Amazon has absolutely eviscerated brick-and-mortar retailers of late with their decision first to buy Whole Foods Market followed by a subsequent announcement that they would target clothing retailers with "Prime Wardrobe."
The Whole Foods announcement sent the stocks of grocery retailers Kroger, Wal-Mart, Sprouts, and Target plunging... (WMT -4%, TGT -5.5%, SFM -7.6%, KR -12%)
And the "Prime Wardrobe" announcement just a few days later had a similar impact on clothing retailers...
So what are these traditional retailers so worried about? Perhaps it's that, at least according to estimates from Morningstar, there are now nearly as many "Amazon Prime" households in the U.S. as there are cable TV households. Here are the details from Recode:
According to estimates from Morningstar, nearly 79 million U.S. households now have an Amazon Prime membership*, up from around 66 million at the end of last year.
That compares to a projected 90 million U.S. households that will pay for cable or satellite TV this year, according to S&P Global.
Of course, if these numbers are even directionally accurate, it means that Amazon Prime has been widely adopted by much more than just the millionaire, billionaire, private jet owners of the world and that moves to target lower income households with monthly subscriptions and discounts for those on government assistance are starting to pay off.
Meanwhile, if this Amazon Go concept store ever becomes the 'norm', then these retailers, and a whole lot of Americans working minimum wage jobs in 1,000s of groceries stores around the country, have very valid concerns about their futures.