Amazon has even more private labels than have been singled out by analysts, according to new research from branding analytics firm L2. Researchers identified 41 private label brands — seven more than flagged by Morgan Stanley, according to the report.
Of those, 29 are in apparel, including denim, activewear, swimwear, and shoes, L2 found. All are operating under trademarks filed by the office of intellectual property lawyer James F. Struthers, whose name has been affiliated with previous Amazon trademark applications, L2 said.
Many of Amazon's latest private labels appear to have launched in the past few months, in time to capitalize on the holiday shopping rush, L2 analyst Cooper Smith wrote in a blog post on Monday.
Amazon has done especially well with its private label consumer goods, notably batteries and baby wipes, but its apparel offerings are gaining traction with consumers, in a challenge to legacy players like Adidas, Nike, and Calvin Klein, according to the L2 report. That puts Nike between a rock and a hard place, considering its decision earlier this year to sell on Amazon.
AmazonBasics goods have been handily crushing other retailer's private consumer product brands for a while, but the Amazon Elements and Amazon Essentials lines aren't far behind, bolstered further by Amazon's acquisition of the Whole Foods 365 line. Amazon's AmazonBasics private label goods dominate its private brand sales, with over $250 million a year to date (a whopping 85% of total private brands sales in the U.S.), but its apparel label Lark & Ro and baby care and vitamins brand Amazon Elements have each grown 90% from last year, according to a report by e-commerce analytics firm One Click Retail. Many products are available only to Prime members, helping expand the value of Amazon's annual $99 membership.
When it comes to fashion, Amazon's private label success presents a multi-faceted challenge to apparel brands. In addition to its various apparel, footwear and accessories private labels, Amazon is experimenting with various sales and delivery models, including a new apparel subscription service (currently in beta), called Prime Wardrobe. Amazon Essentials accounts for 3% of best sellers in all clothing categories on its site, beating out Adidas, Nike, and Calvin Klein, according to L2. That sounds a lot like its consumer goods prowess: Amazon Elements accounts for 5% of diaper category Best Sellers, beating out Unilever's Seventh Generation, and AmazonBasics is the leading brand in batteries, outpacing Duracell, L2 notes.
"This push into private label fashion makes clear how important the category is becoming to the retailer," Smith said. "Rather than wait for popular name brands to distribute, Amazon is filling white space opportunities with its own private label offerings."
While apparel makers can take more control of their brands on the website when they sell directly through Amazon, they run the risk of Amazon evaluating their best sellers and basing its own Essentials items on the performance, according to other L2 research. Even when they don't officially distribute through Amazon, hundreds of their SKUs are available through third-party vendors on its Marketplace, according to the report. For example, there are more than 2,300 Amazon Marketplace listings for Tory Burch items, some with discounts as low as 71% off the manufacturer's suggested retail price.
On Prime Day, for the first time, Amazon's private label brands Mae (lingerie), Goodthreads (men's dress shirts), Lark & Ro (women's dresses) and Buttoned Down (men's dress shirts) landed in Amazon's Best Seller rankings in their categories, driven by full-screen visibility on Prime Day's fashion landing pages, according to L2. In fact, and alarmingly for brands, Amazon's Fashion landing page on Prime Day this year exclusively featured private label products, the research found. And those private labels maintained much of their momentum after Prime Day.