Amazon’s £1 meal deal is savvy but misses the point

Where can you get a lunch for £1 these days? Ironically, it’s not Poundland, whose meal deal will set you back £3. Instead, Amazon has emerged as the surprising champion of the round-pound lunch.

For the month of January, customers can purchase a main, snack and drink for just £1 across the 11 Amazon Fresh stores in London. That’s a significant saving on the £3.90 price tag that usually accompanies its meal deal, which includes its ByAmazon mains accompanied by snacks from the likes of Huel, Bol and Nourish.

Amazon’s quick lunch

There are some important caveats, though. Customers must first visit amazon.co.uk/mealdeal to claim their voucher. Only one voucher is available per Amazon account. And, crucially, customers must pay with the Amazon app.

That’s an important condition. Because as much as Amazon’s checkout-free Just Walk Out system was intended to reduce friction, it has unwittingly created barriers to entry. For customers looking for a quick lunch, the idea of downloading an app just to enter a store is enough to push them into the arms of a less complicated rival.

That much was evident by the addition of a self-checkout in Amazon’s latest opening in West Hampstead, in November. The store also has a gateless opening – as is seen in more recent branches in London’s Moorgate and Liverpool Street – rather than requiring customers to scan their smartphone at an entry barrier.

The lure of a £1 meal deal could well be enough to tempt shoppers to download an app and use the Amazon payment process. Crucially, once that hurdle is overcome, the hard work is done. Shoppers will have the app to hand and be familiar enough with the process to, hopefully, consider shopping in Amazon for groceries once again.

The deal was no doubt inspired by plenty of insights. Lunchtime is an increasingly important – and hard-fought – occasion for the grocers. Get shoppers at this crucial time, and no doubt they will consider you for other occasions and bigger baskets.

The real (meal) deal

The timing – in January, when the public is particularly strapped for cash – is optimal for making an impact. And the price point is low enough to grab attention.

Not only does Amazon undercut Poundland, but it’s significantly cheaper than the major mults, which all charge upwards of £3.50. In London – where the likes of Pret charge £6 for a wrap alone – it’s a particularly appealing proposition.

But it also raises questions. If Amazon needs to offer a £1 meal deal to get shoppers through its doors, should it not be making it easier to get through those doors? Just Walk Out tech was supposed to be a selling point. But if it’s becoming a ‘nice to have’ at best – and a hindrance at worst – where does that leave Amazon’s position in the market? What is its selling point, if not technology?

No doubt Amazon will be thinking through its positioning carefully.

Despite pulling the plug on a few stores in 2023, the launch of a new UK store just two months ago shows it is keen to pursue its grocery ambitions. The £1 meal deal is unlikely to be a game-changer in fulfilling those ambitions, but it’s at least a step towards overcoming that initial hurdle in a crowded market: footfall.