Amazon’s Private Labels Are Nudging Brands Out
If you’ve searched for a product on Amazon lately you have may noticed something was missing – brands you’ve actually heard of. Need a decongestant for a cold? You’ll run into several Basic Care products before you come across NyQuil. Looking for a new dress coat? Get ready for a healthy dose of WULFUL and Austin Mills, but good luck finding Michael Kors. This is all thanks to an invasion of private label pseudo brands Amazon is prioritizing with its on-platform search results. For an example of how pervasive this is check out this screen shot.
So why would Amazon push private label brands? Money, of course. Amazon makes arrangements with manufacturers to “white label” the production of items it will feature at a discount, and then takes a cut of the profit when that items sells. Private labeling is nothing new – you can’t get out of the way of a Kirkland product when you shop at Costco. But as least you know you’re buying a Costco white label item when you choose Kirkland. I’m guessing most WEEN CHARM purchasers don’t realize they’re actually buying an Amazon private label item.
In and of itself, there’s nothing wrong with private label products. They can often be an exact match of the brand names at a discount – nothing wrong with saving money that way. But when the brands you’ve actually heard of are being crowded out by private labels disguised as real brands, that might end up hurting competition and consumers in the long run.