The Rise of Amazon Private Label Brands

27th April 2019 Off By binary
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Just look at these 2 names:

  • Amazon private label brands
  • Amazon’s private label brands

Sounds pretty much similar, isn’t it? Trust me many sellers/retailers still get confused between these two terms although the only difference is of (s).

Yet this one letter (s) actually makes a huge difference. How?

In this article, we will do a deep analysis of what are Amazon private label brands and also know a bit about Amazon’s private label brands. You can also refer the post on how to create a private label product for Amazon.

What is Amazon private label brand/products?

Amazon private label brand can be your own brand or someones’ who want to sell his/her products exclusively on Amazon, with its own brand name or logo.

Nowadays many retailers and sellers are shifting their business to private labeling on Amazon or starting their own online store or both (have an online store and selling on Amazon). Also with handy inventory management software, managing inventory of these private label products has now become easier than ever.

It has been forecasted that private label brands will be expanding dramatically in the next four to five years says Matt Sargent, SVP Retail at Magid to Food Navigator. This is because retailers will recognize that store brands sell at a higher profit margin, offer points of differentiation and enhance customer loyalty.

Amazon defines both its private-label brands (those owned by Amazon) and its exclusive brands (those owned by a third party but only sold on Amazon) as “Our Brands” on its websites. “Our Brands as the name says, it is Amazon’s Private Brands and Amazon curated brands, which are exclusively sold on Amazon”

Amazon allows outside brand manufacturers to sell their product on Amazon by a tag ‘exclusive brands only on Amazon’. Amazon also works with well-established brands to list and sell products as exclusively on Amazon

According to the database of TJI, in the fourth-quarter of 2018, there were 135 private-label brands and more than 330 Amazon exclusive brands on Amazon’s retail sites around the world.

From that same database, Amazon has:

  • More than 40 exclusive or private-label food and grocery brands,
  • More than 60 healthcare and beauty brands
  • More than 20 household goods brands in the U.S. alone.

So let’s have a look at some of the Amazon private label brands. You may have bought items from the list below but unaware of the fact that they are — Amazon private label brand.

List of some Amazon & Amazon’s Private Label Brand

A brief on Amazon’s self-owned private label brands

Amazon is selling more than 450 of its own brands or brands that are exclusively sold only on its platform. Since 2017, Amazon has launched over 70 new private-label retail brands, which now makes it’s total close to 130!

Analysts at SunTrust Robinson Humphrey predict that 50 percent of all online shopping in the US will be conducted on Amazon within the next couple of years. And this will allow Amazon to 2x its revenue from in-house brands (private label brands), reaching $25 billion within the upcoming 4 years!

Amazon’s private label brands benefit Amazon in many ways. They have varieties of product selection which gives Amazon better profit margins. Supply chain management becomes easier too. Other big brands cut down their profit margins on Amazon, to stay competitive with their private label brands.

On Amazon’s the largest selling product category is of apparel and accessories. According to TJI, Amazon has more than 80 private-label and exclusive clothing, shoes and accessories brands in the U.S..

With new items ranging from casual shirts to jeans, leggings, and hoodies, Amazon Essentials (amazon’s private label) which sells apparel items — experienced more than a double sale of 400-items at the end of December, which was just 200 during September.

Also, you can see in the above table that the percentage of apparel items were comparatively more than other product categories.

Some well-known Amazon’s private label brands

Amazon Basics

Launched in 2009, AmazonBasics is the oldest and first ever launched Amazon’s private label brands. AmazonBasics is a full line collection of various electronic items, including USB cables, disposable batteries, tripods, laptop bags, computer mics/speakers and more.

After a slow start, Amazon Basics saw exponential growth in their one product category in particular — batteries. Leveraging their own platform, and offering those private label batteries at discounted price AmazonBasics was able to gain nearly one-third of all online battery sales in just 3 years.

Amazon Essentials

Amazon Essentials — another private label of Amazon, which features extremely affordable items of clothing. Amazon Essentials looks like a fast-fashion version of labels such as Dockers, Old Navy, and JC Penney house brands like St. John’s Bay.

Amazon Elements

In previous years Amazon’s private label brand, Amazon Elements only used to sell baby wipes, after discontinuation of baby-diapers. Now Amazon Elements is moving beyond baby products and introduced its own line of vitamins and supplements under their own brand- Amazon Elements.

Also, Amazon Elements vitamin and supplement cannot be bought by any shopper, he/she must be Amazon Prime member to order them.

Conclusion

Amazon first started its private label business in 2009, and now the company has over 120 of them. Amazon’s dominance in the e-commerce world has forced small as well as big brands to adopt an Amazon-first strategy, in order to remain relevant competitive.

However, private label brands do have an unfair advantage over other sellers selling across Amazon. Why? Because you can’t stop the one, who is letting you do business, on its own platform which is eventually — world’s giant ecommerce marketplace.


The Rise of Amazon Private Label Brands was originally published in Hacker Noon on Medium, where people are continuing the conversation by highlighting and responding to this story.

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