Amazon is using insights from its store to build a private-label juggernaut that now includes more than 3,000 products — from apparel to laptop stands:
At first, AmazonBasics — launched in 2009 — focused on batteries, recordable DVDs and such. Then for several years, the house brand “slept quietly as it retained data about other sellers’ successes,” according to the report. But in the past couple of years, AmazonBasics has stepped up the pace, rolling out a range of products that seem perfectly tailored to customer demand.
“When we saw AmazonBasics products as bestsellers in several categories, our stomachs dropped and [we] started thinking, ‘we need to learn from them,”’ the report’s authors said. AmazonBasics now has more than 900 products, including 284 launched last year alone, according to Skubana.
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Initially, Amazon partnered with traditional chains such as Gap, Nordstrom and Eddie Bauer but retailers decided to pursue their own Web stores. Now, a shopper searching Amazon for a “women’s v-neck sweater” will find a black cashmere number from Lark & Ro, which also sells dresses and swimwear.
Lark & Ro is one of seven apparel brands trademarked by Amazon. Besides women’s clothes, the company also sells men’s dress shoes from Franklin & Freeman and suits from Franklin Tailored. Scout + Ro makes kids’ clothes. Altogether, Amazon’s apparel brands sell 1,800-plus products, according to Edward Yruma, a retail analyst at KeyBanc Capital Markets.
While Amazon’s apparel brands remain relatively obscure, the online behemoth has a huge advantage over better-known labels. Shoppers increasingly start on Amazon.com to search for products, bypassing Google and traditional chains’ websites. In a survey of 2,000 U.S. consumers conducted by digital marketing firm BloomReach, 44 percent said they go directly to Amazon.
So not only can Amazon track what shoppers are buying; it can also tell what merchandise they’re searching for but can’t find, says Rachel Greer, who worked on the private label team until 2014. Then, she says, “Amazon can just make it themselves.”