Over the last week, the mainstream press and the old school trade magazine have celebrated the reported failure of private brand at Amazon, with gleeful enthusiasm. The report which comes from e-commerce research firm Marketplace Pulse has stirred the reporters into a giddy frenzy of click-inducing headlines, including:
- Bloomberg: Most Amazon Brands Are Duds, Not Disrupters, Study Finds
- The Motley Fool: Amazon’s Getting Schooled in the Private-Label Game
- Arkansas Democrat-Gazette: Study: Amazon brands’ sales duds
- Chain Store Age: Study: Amazon’s private brands not all that popular
- Retail Wire: Are Amazon’s private labels falling short or just getting started?
- Store Brands Magazine: Amazon’s private label products still a hard sell
- Store Brands Magazine: Amazon private labels a flop?
- Payments.com: Study: Amazon Private-Label Products Aren’t Market Disruptors
Honestly, I have done my best to resist writing about the report. After reading I thought it was both shallow and ill-informed. The report lacks a basic understanding of modern private brand portfolio management. Amazon is executing a robust private brand portfolio strategy that includes unique customer targets, brand positionings, sales and margin goals, SKU count goals, marketing resources and innovation budgets. Simplifying success to size and sales is easy but lacks the depth required to truly understand Amazons private brand strategy
Amazon has a lot to learn in private brand, and they have had their failures, however, anyone reads the Marketplace pulse report and breathes a sigh of relief and takes their eye off Amazon is either foolish or deluded.
Beware of putting too much stock in this report. The mainstream and trade press should know better than to jump on this report like its chum in the water.
If you would like to know my thoughts on private brand at Amazon I will be presenting, “The Extraordinary Rise Of Private Brand At Amazon” at our Velocity Conference April 29 – May 1 in Charlotte, NC
I will take a deep dive into the meteoric rise of private brand at Amazon. Address the Marketplace Pulse report and paint a picture of the private brand successes and failures which fuel their continued, aggressive growth. With more than 100 private brands across virtually every category, the Whole Foods portfolio of private brands, and complete control of their ecosystem… the future of Amazon will be defined by private brand.