SEATTLE – Amazon, the online giant retailer, is asking consumer-goods companies to create brands exclusively for Amazon. The Wall Street Journal reports that Amazon found developing these brand-name products on its own too expensive and time-consuming.
Equal sweeteners and nutrition brand GNC are the first to launch products through a new program that Amazon started last year to outsource the work. Mattress company Tuft & Needle is also creating a brand called Nod exclusively for Amazon.
Although manufacturers benefit from selling products through a variety of retailers, Amazon has become a key avenue for brands looking to increase online sales. When a company agrees to join the club, the brands will get help launching products on Amazon.com and receive faster customer feedback when trying something new, and a boost in sales revenue. Since they’re “in” with the right crowd, their products will appear at the top of Amazon search results.
Amazon is also growing its private label brands. The estimate is currently at 100 products, which include everything from suitcases and batteries to baby products. These in-house brands create a higher profit margin for retailers and using outside manufacturers means Amazon can ramp up private brands faster with lower costs.