| The problem with this is that it's built in the backs of brands who were at one point well recognized brands on Amazon. Amazon took their sales data, determined it was a good market to move into, created specifications and reached out to their hundreds of sellers for a "private label opportunity". Cue making dozens of companies compete to supply Amazon with the manufacturing contract and constant downward pressure and you get a good product from Amazon at a good price. Not a problem right? Until the private label brand forces 90% of those formerly quality-focused small brands to shut down and due to their "algorithms" detecting less competition, begins raising prices again. And now the expertise of small brands is gone and no competition springs up in the market. I've seen this happen in a couple product lines over the year and is one reason we pulled off Amazon. Amazon customers are entitled pains in the ass, and the margin there isn't sustainable. The only way for small brands to make Amazon work is to aggressively sell a single SKU and put in remarketing/back-channel outreach to customers and make the conversions to the rest of your product line off Amazon. This is explicitly against Amazon's policy, but their policy is in place to ensure they profit and you never gain traction so you remain reliant on them until they day they put you out of business with their own private label line. |
Not sure I'm seeing the problem. On the surface it sounds pro-consumer. Plus, this is already common in brick & mortar stores, I think Costco is particularly well-known for doing this (and of course private-label/house/generic store brands are hardly uncommon elsewhere too). If it was that destructive, why do we still have brand names in regular stores as it is?