Amazon continues rationalization of house brands

Amazon is reported to be scrapping most of its in-house brands, including its furniture brands and 27 out of 30 clothing brands, although many of these will remain on the website until the remaining inventory is sold off.

Context 

A year ago, the e-commerce giant was reported to be halving the number of private-label products it offers in the US, but it said then that it was not seriously considering closing its private-label business, which encompassed some 243,000 products across 45 brands in 2020.

What’s happening 

• Sources now tell the Wall Street Journal, however, that “tens of thousands” of products have been retired and the total number of house brand numbers are fewer than 20. 
• Some products that have sold well under discontinued lines will be rebranded under remaining labels such as Amazon Essentials or Amazon Basics. 
• Amazon only says that it looks to eliminate products that “aren’t resonating with customers”.

Why does Amazon matter?

• Amazon’s development and promotion of its in-house brands has in the past raised questions about anti-competitive practices; scaling back its private-label business will likely diminish those concerns. 
• The move is also in line with a wider drive to cut costs in a post-pandemic downturn.

Sourced from Wall Street Journal