Amazon is going to start selling its own brands of food, diapers and cleaning materials. It has already been testing new brand names like Mama Bear and Happy Belly, with a view to rolling out new products to Amazon Prime members within the next few weeks.
Big FMCG brand owners already have to compete with supermarket chains creating own-brand products that “emulating” the big-brand packaging design, but online has thus far been a safe haven. No longer. Amazon already accounts for over 50% of US e-commerce already. So what does this mean for independent etailers?
According to Quartz, this is all, “part of a play to shore up the advantages of subscribing to the company’s Amazon Prime service, which seeks to become a one-stop-shop for consumers looking to buy anything from books and clothing to food and video streaming. The online retailer recently plunged into the British grocery delivery market and it has been building facilities across the US to ensure its delivery speeds remain unmatched by other retailers.”
The global food retail market is worth $2.14 trillion, so there’s plenty of room for Amazon to grow. And as Vanity Fair points out, “The e-commerce giant has a number of built-in advantages, too. Amazon has a customizable edition of its Dash Button, which literally lets users purchase products at the tap of a physical button they can install in their homes. Amazon Echo allows users to place orders with its voice-assistant technology, and the company also offers a grocery delivery service through AmazonFresh.”
So this could present brand owners with a real challenge to their online sales, but however all-powerful Internet giants may seem to be, they are still run by fallible humans. This may be a step too far for Amazon. Food product design and distribution is complicated, and it will only take one tainted-food PR disaster for Amazon’s carefully protected image to take a huge hit.