As Amazon-run private label brands grow to roughly 100 with $25B in expected revenue over the next four years, potential antitrust concerns could arise
It started with a simple battery. — Around 2009, Amazon quietly entered the private label business by offering a handful of items under a new brand called AmazonBasics. Tweets: @jeffmacke , @pakman , @stuartemmrichny , @nytimes , @nytimesbusiness , @damianburns , @stevesi , @nytimesbusiness , and @sriramk Tweets: Jeff Macke / @jeffmacke : Amazon has launched 60 private label clothing brands in the last year. Overwhelming assortment of what amount to the same pant / oxford / polo. Just bought some to try. Amazingly difficult. Curate. Don't just throw crap at me. (Cc @talktoskirt ) http://www.nytimes.com/... David Pakman / @pakman : Legacy brands are severely challenged in an amazon world - with no direct relationships with customers, they just get owned by Amazon onsite or choose not to sell there and miss 50% of the market. http://www.nytimes.com/... Stuart Emmrich / @stuartemmrichny : ‘Amazon has access to data that no one else has,’ a former company exec tells @julie_creswell in Sunday's @nytimesbusiness piece about how Amazon is building a $24 billion private label business that is crushing its online competition http://www.nytimes.com/... @nytimes : It started with a simple battery. Now Amazon is using the power of its global marketplace to steer shoppers to its own products. http://www.nytimes.com/... @nytimesbusiness : What do Goodthreads menswear, Lark & Ro dresses, Wag dog food and Rivet home furnishings all have in common? They are all Amazon in-house brands, part of a fast-growing business that is expected to double in revenue to $25 billion in the next 4 years http://www.nytimes.com/... Damian Burns / @damianburns : Aside from being a major revenue play in its own right, there's more to Amazon's private label strategy than just unit sales. Every one of these items suppresses the visibility of established 3rd party brands in Amazon search. So they buy Search ads. http://www.nytimes.com/... Steven Sinofsky / @stevesi : Retail gonna retail. This and the downstream impact are entirely predictable based on retail history. http://www.nytimes.com/... @nytimesbusiness : The private label business is booming at Amazon, as the company is aggressively selling everything from its own line of low-cost batteries and diapers to more upscale jeans and slip dresses. http://www.nytimes.com/... Sriram Krishnan / @sriramk : Lots of parallels here with how Google has been handling search results for things like reviews - AMZN and Google deciding that once they had the demand, they could also then vertically build the supply. http://www.nytimes.com/...
Context & Ripple Effects
This story lands midway through a documented build-out: Quartz had already tracked AmazonBasics growing from about 250 products in June 2013 to over 1,500 (per Internet Archive snapshots) before the Times counted roughly 100 house brands overall with $25B in expected revenue over four years. What began with batteries has become a portfolio spanning apparel lines like Lark & Ro and Goodthreads.
The piece also flags the conflict that later reporting kept confirming: Amazon runs the marketplace while competing inside it, using marketplace data to steer shoppers — later shown when it was found pitching its own labels as customers add rival products to their baskets.
First-order effects
- Third-party sellers on Amazon now compete against a landlord that owns roughly 100 brands and controls search placement, so established brands lose visibility without any change in their own performance.
- Amazon faces its first serious antitrust exposure over private label: the $25B projection makes the program too large to stay under the radar of regulators examining whether platform data is being turned against marketplace participants.
Second-order effects
- Brands selling on Amazon are pushed to buy ads and bid for placement simply to hold their ground against house labels — a dynamic later visible when Amazon used the top-left results slot, a premier paid position, to promote its own products (during the pandemic).
- Manufacturing shifts upstream: the OneZero investigation into AmazonBasics batteries showed the operation runs through a discreet outsourcing network, meaning contract manufacturers gain volume from Amazon while the brands they once made for lose shelf position.
Third-order effects
- If the pattern holds, marketplaces structurally split into two tiers — platform-owned labels with data and placement advantages, and everyone else paying for access — which is precisely the conduct antitrust doctrine on dominant platforms would have to catch up to.
- Not every house brand wins: the Marketplace Pulse analysis of 23,000 products found most Amazon-branded goods were flops, suggesting the durable advantage is not the products themselves but the data and distribution that only the platform operator commands.
The trend: Platform operators are converting marketplace data and placement control into first-party product businesses, forcing regulators to decide whether being the store and selling in it is a conflict the law should police.