Amazon looks to pacify big names with “top brand” status
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Amazon looks to pacify big names with “top brand” status

Ecommerce titan Amazon is looking to improve relationships with some of the most visible brands on its platform in a move that will see them recommended to customers. The company, which counts brands like Speedo and Under Armour amongst its product offerings, has previously stayed out of “which brand is best”. But these massive companies have a certain amount of pull – and they usually get preferential treatment in brick-and-mortar retail destinations. Now, Amazon is experimenting with a way to mirror that treatment online, and build closer relationships with some of its biggest sellers.

Amazon’s share price has appreciated by 23% so far this year

Amazon Aug 22

Source: Yahoo Finance

Last Friday, an ecommerce research firm revealed that Amazon has been testing a “top brands” label to products from a number of its most popular brands, like Under Armour, Fruit of the Loom, Speedo and New Balance. This helps them to stand out in product search results. Amazon has confirmed that it’s trialling the system, and said that the brands in question don’t pay for the labels.

The idea of labelling products in search is not new – Amazon already applies designations like “Best Seller” and “Amazon’s Choice” to some goods. Who gets the label depends on a number of factors, like customer reviews, availability and pricing. Analysts say that these labels can boost sales in some cases.

Amazon accounts for around 40% of online sales in the US, and companies have long complained that giving third-party sellers free reign on the platform has had a manifest impact on the number of counterfeit goods in circulation. Amazon is hoping this new label could redress that situation, helping it build bridges with big brands.

Disclosure

Dominion holds Amazon in its Global Trends Ecommerce Fund.


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