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4 things to know about Amazon’s private label program

4 things you should know about Amazon’s private label program
Amazon has numerous advantages in marketing and selling its ever-increasing line of private label products. Find out how to level the field and compete.

In less than three years, Amazon has tripled the number of private label brands it offers and products it carries.

But this news isn’t a horror story for natural brands or retailers. Outside of some supplements, baby food and Whole Foods-type brands, few of Amazon’s private label products would hold up to the standards of the natural industry.

Nevertheless, the information we found demolishes some popular urban myths and provides some advice on how to compete with Amazon’s private label products.


4 things you should know about Amazon’s private label program Juozas Kaziukenas

Amazon’s private label products don’t kill off competitors

For products with little or no brand loyalty—laptop stands or batteries, for example—Amazon’s private label products do affect third-party sales. But in general, Amazon’s private label sales take just teaspoons of water from the third-party sellers’ oceans, Bloomberg reported in 2019.  

In the household goods category, 14% of the best sellers are Amazon private label or exclusive brands, according to Gartner L2’s report, Amazon Private Label 2019.

“We conclude that Amazon’s private label efforts have been given too much credit, both in their ability to disrupt categories and the capability to utilize internal data,” Marketplace Pulse said in an analysis of Amazon’s private brands.


4 things you should know about Amazon’s private label program Jeff Wilke, CEO Worldwide Consumer

Third-party products are Amazon’s bread and butter

Third-party products account for the majority of what Amazon offers its customers and what it sells them. Third-party listings, as a percentage of Amazon’s total listings in seven categories, range from 99% in home and kitchen to 66% in books, the company reported to Congress this year.

In dollars, third-party sales are about 60% of Amazon’s total sales, up from 3% in 2000, Amazon reported. Third-party sales are 72% of softlines, which includes apparel, footwear and accessories; 67% of home and kitchen; and 65% of beauty. Consumables, toys and consumer electronics all have between 50% and 60% of their sales from third parties; books has 26%.

Amazon’s private label products account for less than 1% of the company’s listings and about 1% of its total sales, according to the report. By category, private label products account for 9% of softlines sales; 4% of home and kitchen; 3% of consumer electronics; and 2% of consumables, according to Amazon.

A study by Marketplace Pulse determined that Amazon had more than 8 million third-party sellers globally in 2019, up from about 900,000 in 2009, Business Insider reported.


4 things you should know about Amazon’s private label program Coresight/DataWeave report

Amazon has broadened its private label offerings and customers like them

As of April 2020, Amazon offered more than 22,600 private label products in 111 brands, according to a study by Coresight Research and DataWeave that reported on in May. That’s more than three times the number of private label brands it carried in June 2018.  

More than half of those products, 54%, are in apparel, accessories and footwear. Two years ago, those categories accounted for about 75% of Amazon’s private label products.

So what categories have caught Amazon’s attention recently? Home and kitchen, with 3,400 products; grocery and gourmet food, with 1,820 private label products; and home improvement, with 1,104, according to


4 things you should know about Amazon’s private label program Marketplace Pulse

How can third-party brands compete with Amazon’s private label products?

Amazon has access to incredibly detailed data on what its third-party vendors are selling, but any retailer can see what its customers are buying and set out to recreate a competing brand.

However, Amazon also has the advantage of deciding how its private label products will be advertised and positioned on its website or turn up in its search results.

Price seems to be one of the biggest factors in a private brand’s success, followed by a high number of customer reviews.

“For brands, it is important to invest in Amazon presence and acquire reviews, thus establishing their brand credibility on Amazon in a native-to-the-platform way. Sometimes that could mean launching sister brands to cater to the low end of the price spectrum,” the Marketplace Pulse report said.

“Brands need to have a very self-serving approach to Amazon, utilizing the platform not only for sales and advertising but as a resource to get feedback on what is and isn’t working for their products, as well as the products of competitors including Amazon,” it continued.

AmazonBasics is Amazon’s most successful private brand, Marketplace Pulse reported after it analyzed 406 Amazon brands with a total of 23,142 products, along with 1.4 million customer reviews.

Marketplace Pulse found 1,352 products under the AmazonBasics brand with an average price of $29.70. The Amazon Basics Store homepage offers a quick look at the breadth of its offerings: holiday gifts, kids, bedding, kitchen, household, home improvement, pets, office and more.

All AmazonBasics products generated a total of 839,260 consumer reviews with an average rating of 4.26 stars, according to Marketplace Pulse. Because only 3% to 5% of units sold generate reviews, the number of reviews per product indicates how popular that product is compared to similar products, the study said.

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