Brands Invent New Lines for Only Amazon to Sell
Amazon gets exclusive products, while brands receive faster customer feedback, marketing support and increased sales
Manufacturers would profit more from selling their products through a range of retailers, but they say they are eager to offer up their concepts solely to Amazon. In exchange, brands get help launching their products on Amazon.com, faster customer feedback when testing new products, marketing support and revenue from the sales. They also can appear at the top of search results—a big draw, given Amazon’s platform lists an estimated 550 million items.
.. Amazon, on its own, also has been quietly growing the number of its in-house brands in recent years. Analysts estimate they now have more than 100. Those include the more obvious AmazonBasics brand, which makes everything from suitcases to batteries; the Happy Belly brand of foods; and the Mama Bear baby products brand. Amazon sometimes promotes its own brands higher in search results, like “Amazon’s Choice” and sponsored items, or default results in voice searches using Amazon’s Alexa virtual assistant.
In-house brands often generate a higher profit margin for retailers, including Amazon, and can draw in customers because they can’t find those brands elsewhere. But developing a new brand and formulating products takes time. Amazon spent several years crafting and launching brands like Happy Belly and Mama Bear. By getting other brand manufacturers to do that work instead, Amazon can ramp up its private-brand offerings faster and at a lower cost, people familiar with the program said.