Amazon still cultivating private label in grocery

Supermarket chains can breathe easy — for now, at least — about Amazon’s grocery push on one front: private label.

Of Amazon’s roughly 7,000 private brand products, less than 2% are food and beverage items, according to an analysis of the e-tailer’s private label offering by Coresight Research. A far higher proportion is in apparel, which accounts for nearly 5,000, or approximately three-quarters, of Amazon’s private brand roster.

“Apparel is the dominant category in Amazon’s private-label offering, and one that appears to be growing, as the retailer pushes further into the clothing and footwear markets,” Deborah Weinswig, chief executive officer and founder of New York-based Coresight, said in the report. “In contrast, Amazon’s private-label offering in grocery categories such as food and household care remains limited, and in beauty and personal care, Amazon offers just two private-label products.”

Two Amazon brands combined for 124 food and beverage products: Wickedly Prime (81 items) and Happy Belly (43 items), representing 1.8% of the retailer’s 6,825 private label offerings. Launched in December 2016, Wickedly Prime includes such consumables as bars, chips and crisps, nuts, popcorn, puffed snacks, soup, seaweed snacks, sweet spreads, tea and matcha and trail mix. Happy Belly, which made its debut in July 2016, includes snack nuts and seeds, snack and trail mixes, and roasted bean and ground coffee.

Health and household products — under the Amazon Essentials, Amazon Basics and Presto labels — accounted for the same percentage as food, totaling 126 items.

“This category includes one of Amazon’s oldest private labels: Amazon Essentials, which was launched in 2014, and spans multivitamins to baby care products. The Presto and AmazonBasics brands offer products in health and household, too, in categories such as household cleaning products,” Weinswig stated. “Together with food and beverages, health and household makes up Amazon’s still-limited private-label offering in grocery store categories.”

However, she pointed out that high-volume grocery store items are among the most-reviewed of Amazon’s private labels and have received high marks from customers in its five-star rating system. For example, the food brands Wickedly Prime and Happy Belly had average ratings of 4.2 and 4.3, respectively. Amazon Elements, the most-reviewed private brand, had an average rating of 4.4 out of five stars.

“The average Amazon private-label product generates a customer rating of four stars out of five, suggesting overall solid customer satisfaction levels,” Weinswig said in the “Deep Dive: Slicing and Dicing Amazon’s Private-Label Offering” report.

Overall, 4,904 (72%) of Amazon’s private brand products were clothing, footwear and accessories. The next largest category was home and kitchen, with 852 items (12.5%). Other segments included tools and hardware with 239 products (3.5%), electronics with 217 items (3.2) and office with 90 products (1.3%).