It is Amazon’s market data, gathered through the whole of its business, marketplace and traditional e-commerce, that gives Amazon an increasingly better shot at establishing its own private labels. The better the glimpse into a market, the better the company can design products for that market. (And private labels have higher margins for merchants, obviously.) That is why the dominance of the US online market is even more valuable than one might think. It opens up new options. (But make no mistake, Amazon is even in the US still just a minor player if one looks at all of US retail, not just online.)
In a series of postings for “brand manager” positions, Amazon said it was looking for candidates “to build authentic activewear private label brands that have compelling and unique DNA and deliver amazing consumer valued innovation.” […]
In the last year alone, Amazon has quietly unveiled at least eight of its own clothing brands including a women’s label called Society New York and a kids clothing line dubbed Scout & Ro.
Most recently, it revealed a men’s buttoned-down shirt brand — creatively named Buttoned Down — that sells dress shirts starting at $39. They are only available to Amazon Prime members.
Quartz on data:
[…]wardrobes in the US and elsewhere are becoming more casual, sports-influenced, and stretchy. Amazon is evidently looking to capitalize on activewear’s rapid growth, which analysts believe will continue for some time to come.
Amazon of course already knows what people want to buy. A 2015 report by financial firm Cowen and Company noted that there were 90,000 listings for Nike products alone on the site. By tracking which items are selling, Amazon can get a pretty good idea of what it should offer under its own brands.
Amazon is doing all different kinds of private labels, besides its already well-known ‘Amazon Basics’. Last year for example, the company has gone into nuts. (yes)
In 2015, Amazon tried its hands at a private-label diapers brand only to pull the brand again less than two months after launch.
With the Amazon Dash Buttons, the data angle for Amazon becomes even more interesting as Amazon gets unprecedentedly complete insights into the consumption of consumables.
Amazon Basics even got their first own Amazon Dash Button recently. In November of last year, I wrote:
Now, with the first ones of likely many AmazonBasics Dash Buttons we see a new level of vertical integration that should frighten not just merchants but manufacturers of consumables as well.
Data and private labels, leading to a virtuous cycle of vertical integration.
More on this topic:
* Data from Dash Buttons Will Lead to Evolution of Brands & Amazon’s Private Labels
* zLabels Are Responsible for 10-15% of Zalando’s Revenues, Will Be Available at Asos, Amazon and Others Going Forward
* Amazon Goes Nuts With its Private-Label Foods
* Here Is What a Big Part of Amazon’s Endgame Looks Like