Amazon ‘doesn’t have private labels cracked,’ report says

AUTHOR

Daphne Howland@daphnehowland

PUBLISHED

June 4, 2018

Dive Brief:

• Amazon claims more than 80% of consumer conversions against other e-commerce sites across diverse product categories, and that continues to grow as much as 14% quarter over quarter, according to a new report from analytics firm Jumpshot.
• Amazon has the highest conversion market share with “one-click commodity” product categories, according to the report, which was emailed to Retail Dive. Some, including batteries, have the highest quarter-over-quarter growth, with cleaning supplies growing 13%. But higher-priced product categories like kitchen and dining grew just 4% in the period, according to Jumpshot.
• Much is made of Amazon’s private label prowess, but Jumpshot presents a mixed picture. AmazonBasics accounts for 88% of its private label conversions, and it leads only in electronics (which are nearly half of those purchases). Take out AmazonBasics, and the e-commerce giant owns just 7% of conversions market share. “Amazon doesn’t have private labels cracked,” the report notes.

Dive Insight:

Jumpshot says its specialty is sussing out data from “walled gardens” on the internet — and there may be no e-commerce player more walled off than Amazon.

That means that a lot of companies are crunching numbers to determine what’s going on over there. From this report, as with others, it’s clear that in many areas Amazon continues to pocket market share. When it comes to searches, the e-commerce giant is on pace to own more than 75%, according to a statement from Jumpshot CEO Deren Baker.

Baker’s team reached two key, and related, conclusions about brands selling on Amazon: They’re running “neck and neck to win market share on Amazon, with no clear leader,” and that close market share among them suggests that Amazon shoppers don’t offer much brand loyalty.

That creates an opening for Amazon itself to encroach on brands’ turf. Many experts have warned that brands selling on Amazon open themselves up to the host taking advantage of their sales data to knock off their own bestsellers.

However, although Amazon has more private labels than observers previously thought and continues to develop even more (most recently a Prime-exclusive private-label pet food), “Amazon doesn’t have private labels cracked,” according to Jumpshot.

AmazonBasics, a commodity goods line that includes mostly electronics and electronics accessories like phone chords, makes up 88% of Amazon’s private label products, and Amazon owns 61% of private label conversions. But without electronics, Amazon enjoys just 26% conversion share.

And other retail giants own significant market share in key categories. Excluding AmazonBasics, Walmart, Target and Macy’s have 93 % market share, Jumpshot said. More than half (52%) of Macy’s private label sales are in women’s clothing, 39% of Target’s are women’s clothing and home, and 38% of Walmart’s are in home and women’s clothing.

For its quarterly snapshot, Jumpshot studied anonymous consumer actions within 500 online e-commerce sites and marketplaces in the first quarter, and analyzed visits and conversions of different brand categories across these sites.