SUMMARY
This Comes At A Time When Rival Flipkart Is Aggressively Trying To Scale Up Its Private Label Business
With competition in the country’s ecommerce space reaching a fever pitch, Amazon India is reportedly looking to expand its private label business, as a way of boosting its revenue growth. According to sources close to the development, the online marketplace is gearing up to launch a number of in-house brands across multiple categories in 2018.
The development comes at a time when its formidable rival Flipkart is aggressively trying to make its private label business sustainable.
Shedding light on the global ecommerce behemoth’s plans, Manish Tiwary, Vice President, Category Management at Amazon India said in a recent interaction with Livemint, “We have selection gaps in every category. Our large vendors on the private labels side, we’ll keep on filling the gaps using them.”
Mimicking Flipkart’s strategy, Amazon India is set to launch a separate private label brand for both large and small appliances categories, sources revealed on condition of anonymity.
Without disclosing specific details about Amazon’s private label push, a spokesperson told Inc42, “We do not comment on speculation around what we may or may not do in the future. However, we are a customer-centric company and our goal is to provide the widest selection to the maximum number of customers. We will, therefore, continue to evaluate any need gaps in selection that may be served by launching specific products in that category to help achieve this goal of widest selection.”
Inside Amazon’s Private Label Push
Like its arch-nemesis Flipkart, Amazon has been doubling down to gain a solid footing for its private label business in recent times. So far, the Jeff Bezos-founded company has launched more than five private label brands.
Speaking on the company’s private label push, Tiwary said recently, “As far as the private label part is concerned, it’s largely driven globally. The fact is they have such a huge assortment. If I can’t find the selection here, I do go to them.”
Challenging Flipkart’s ‘Make in India’ brand Billion, Amazon introduced AmazonBasics in India in September 2015. Geared towards expanding its consumer base, AmazonBasics offers a range of high-quality products for customers to enjoy at value pricing.
In January 2016, Amazon started men’s private fashion lab, Symbol. Later in December of the same year, it announced the launch of Myx, an in-house private label for women’s ethnic wear.
Additionally, the company also started Solimo, a furniture and home and kitchen brand, in 2016. Apart from these, Amazon is also in the process of building a private label portfolio that encompasses accessories, fashion, cookware and furnishings, among other categories.
Recently, it was reported that Amazon India might also launch its own label of beauty and personal care products. If Amazon makes such a move, it would be concurrently challenging Flipkart owned Myntra, which has recently announced its plans to open beauty and wellness offline stores.
“I have more than enough to do with Symbol, Myx and Solimo. Let’s take Solimo as an example—we have 400 ASNs (stock keeping units) and we’ll add at least more than double the number of ASNs across categories,” Tiwary added.
With the Indian ecommerce market poised to touch $200 Bn by 2026, as per a report by Morgan Stanley, several contenders are now fighting it out for the coveted crown.
While on the one hand, Flipkart is utilising the investments from SoftBank, Tencent and others to establish a strong presence for its private label business, Amazon has set its eyes on thwarting competition and becoming the champion. How the war in the ecommerce space pans out remains to be seen.
