Much has been made about how Amazon’s private label products are dominating everyday items like diapers and batteries as well as IoT devices, and now with the company’s push into apparel, everyone is waiting to see how much market share the e-commerce giant will steal from the already challenged sector.
Data management and analytics company 1010data dug into the consumer spending numbers to determine whether Amazon’s private label brands are performing better, worse or on par with its competitors.
Currently Amazon brands have only accounted for 2 percent of units sold in the first half of the year. But if Prime Day is any indication of where things are headed, competitors need to take notice. During the company’s one-day anniversary sale, private label sales hit 12 percent of the total units sold.
The company’s proprietary electronics like the Kindle and Fire TV Stick, make up 55 percent of its private brand sales currently. AmazonBasics, its line of essentials spanning computer cables to bed sheets, is 2,000 products strong and accounts for 41 percent of the pie with sales of $210 million in the first half. Currently, clothing is just 1 percent of this business.
[Read more about Amazon’s private label push: Private Label, Amazon’s Secret Fashion Weapon]
But over the last year, Amazon has made a major push into apparel and accessories under label names that don’t tip off the fact that the same company consumers already shop for toothpaste and toilet paper is now proffering fashion collections.
Lark & Ro women’s apparel, Buttoned Down men’s dress shirt line and Amazon Essential’s basic apparel collection barely make it into Amazon’s top 10 for private brand sales with $1.9 million, $950,000 and $870,000, respectively.
That makes Amazon’s labels puny compared to its competitors. In 2016, Macy’s Alfani label sold 9 times Lark & Ro and Nordstrom’s Halogen outsold it by 11 fold, according to Slice Intelligence. But it’s too soon to count them out.
Of the brands that have been around for at least year, Amazon’s Scout + Ro kids’ line grew by 542 percent year on year, making it the fastest growing of the 20 brands. Franklin & Freeman men’s shoes and Lark & Ro also are also racking up fast growth at 153 percent and 84 percent, respectively. On the other end of the spectrum, the e-tailer’s Pinzon bedding and towel line contracted by 28 percent.
[Read more about online clothing sales: Online to Claim 40% of Apparel Market Share in 2030s]
To date, it looks like Amazon shoppers are stumbling upon many of the company’s apparel products with generic keyword searches, showing they don’t have name recognition yet but that doesn’t mean they’re not a potential threat.
“If the most popular search term for a brand is the brand name, that indicates strong brand recognition in the market. However, if the top search term for the brand is the name of the product they are most known for, it could mean that the brand is stealing sales from a competitor,” 1010data said in the report.
For instance, Lark & Ro, Paris Sunday and Buttoned Down, are winning customers who are searching for products not brands, meaning those dollars were up for grabs. On the other hand, people are searching specifically for basics collection Amazon Essentials, men’s wear brand GoodThreads and Scout + Ro, indicating the lines are gaining mindshare and a following.