There’s one hard lesson that Amazon competitors have learned. That is, once your niche grows big enough on the Amazon e-commerce site, you may become a target for Amazon to introduce its own house brand to compete directly in your niche.
For example, Amazon is talking with Taiwanese clothing manufacturers to produce samples for a new brand of activewear designed to compete directly with big players like Under Armour, Lululemon and Nike. In direct competition with Walmart and Target private label fashion lines, Amazon announced a new Drew Barrymore line of clothing with the popular Hollywood actor. Just four years ago, Barrymore featured her Flowers cosmetics line in partnership with Walmart.
Amazon also launched its Handmade Gift Shop, a direct competitor with Etsy and featuring thousands of handcrafted, one-of-a-kind items from jewelry to baby decor. The gift shop has categories for men, women, kids, babies, couples and last-minute gifts.
The “gray” product market is also a challenge for brands, makers and sellers on Amazon. 51% of Q2 products on Amazon were sold through third-party sellers and 80% of product listings for Michael Kors and Geneva watches were third-party sellers. If that’s not tough enough, the Amazon Collection jewelry brand dominates its category listings.
More evidence? You know those popular TV commercials for Ring.com and Nest home security products and smart devices? It’s a big product category and it fits right into Amazon’s smart devices/smart home strategy. The launch of Amazon Key not only introduces a new Cloud Camera and locks, it bundles together a new smart lock delivery service for Amazon Prime members featuring millions of products for delivery in 37 US cities initially. Shop on Amazon, select “free delivery” and Amazon will enable you to unlock the door remotely so your package can be placed safely inside your home.
Walmart, Target and other retailers are also offering free delivery and in-store pickup programs but Amazon Key is built with and driven by all the data and technology know-how of Amazon. That is very tough competition!
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E-commerce innovation and growth ahead
Amazon Getting Into the Sportswear Business
Amazon appears ready to disrupt yet another product vertical: activewear. And no surprise, activewear companies are already struggling to stand out in a sea of competition and discounts. Last month, for example, Nike said it expects sales to decline this quarter in North America. Under Armour also cut its annual sales forecast in August. What’s more, after Bloomberg’s report last week, shares of lululemon fell 4.9 percent, while Under Armour declined 2.8 percent. Via mytotalretail.com
Amazon Fashion signs up Drew Barrymore’s ‘Dear Drew’ collection
Amazon continues to flex its fashion muscles, this time with a high-profile launch of a celebrity’s collection. The new Drew Barrymore line eclipses her tie-up with Walmart four years ago, which placed her lower-priced Flower cosmetics line exclusively at that big box retailer. Since then she has expanded Flower, and little mention is made of her Walmart relationship on that brand’s Facebook page. For Amazon, the move is yet another grab at department store and mass merchant mainstays. Starting last year, the e-commerce giant has launched a series of private label clothing and accessories brands in various sub-categories, most recently in footwear. The company is also experimenting with various sales and delivery models, including a new apparel subscription service (currently in beta), Prime Wardrobe. Via retaildive.com
Amazon launches gift shop in the holiday spirit
Amazon has officially launched its Etsy holiday shopping rival. The Handmade Gift Shop will offer a selection of thousands of handcrafted, one-of-a-kind items, ranging from personalized jewelry to custom baby decor. Shoppers can browse categories tailored for their recipient, separated into: For her, For him, For kids, For baby, For the couple, and Last-minute gifts. Although Amazon Handmade, which encompasses 10 categories, has been in existence since 2015 and is available in more than 30 countries, this platform aims to specifically capture the gift-giving shopper. Via fierceretail.com
Watch Out for Amazon
Amazon’s gray market is growing. Third-party sellers accounted for 51% of the e-tailer’s US Q2 sales, up from 45% in 2015. While well-known legacy brands dominate Best Seller lists, half of the bestselling brands don’t officially distribute on Amazon. More than 80% of product listings for Michael Kors and Geneva watches were sold by third parties, according to L2’s Amazon Gray Market report. Another threat is the penetration of Amazon’s private label brands into the women’s jewelry category. Currently, the Amazon Collection jewelry brand dominates traditional jewelry brands when it comes to share of listings on the platform. Via l2inc.com
Amazon debuts Cloud Cam and Key to take on Nest, August and others in home security
Amazon wants to be the hub for your connected home, and today the company announced two new products that will help it fill out that ambition, specifically in home security. It announced a new “intelligent” camera called the Cloud Cam, and a new smart-lock service called Key. Key, meanwhile, will launch on November 8 starting in 37 cities in the U.S. covering “millions of items,” Amazon said. The moves underscore Amazon’s ambitions to be more than just an e-commerce hub for the home — although with Key aimed specifically at enabling deliveries, they clearly will help the company further its e-commerce business as well. Via techcrunch.com
Amazon.com: Introducing – Amazon Key: Amazon Devices & Accessories
Amazon Key is exclusively for Prime members in select cities and surrounding areas. To get started, purchase the Amazon Key In-Home Kit, starting at $249.99. The kit includes: the Amazon Cloud Cam (Key Edition) indoor security camera and a compatible smart lock from Kwikset or Yale. Shop on Amazon and select “FREE in-home delivery” at checkout. On delivery day, we’ll notify you just before the delivery. Amazon will authorize the delivery and unlock your door. You can watch the delivery live in the Amazon Key App or see a video of it later. We’ll notify you once the delivery is complete and your door is relocked. Via amazon.com