Amazon private label success

According to a study by Marketplace Pulse, a New York based e-commerce research firms, Amazon’s private label brands are not a significant threat to established brands. According to Juozas Kaziukenas, founder of Marketplace Pulse: “This idea that Amazon can introduce a product and magically use data to dominate a category is just a conspiracy theory, there are a couple of successful examples everyone uses, but most of their products aren’t successful at all and many other companies continue to outsell Amazon even after it introduces its own competing brands”. Amazon currently sells more than 550 brands; a mix of its own private label items and brands Amazon suppliers have agreed to sell exclusively on Amazon. However, according to the study, 10 of the 550 brands generated 81% of the sales.
One notable exception in the study, was Amazon Basics batteries, which currently command 94% of online battery sales according to a study by Kantar Media. However, according to Kaziukenas, this dominance is an edge case: “Selling cheap batteries is very different than building brands…” and while most of Amazon’s brands have been around for less than two years, Amazon remains in the unique position of using customer data to target specific segments to launch new products, make improvements to existing offerings and target customers with relevant AMS ads.
Related Articles