Amazon’s Elements brand adds vitamins, supplements – Retail Dive

Dive Brief: Dive Insight:

Amazon has long had private label goods, including Pinzon linens, Elements baby wipes, and its AmazonBasics line of tech accessories, and it recently launched several private-label apparel and accessories brands. Amazons new in-house brands include a line of food basics like Happy Belly nuts, trail mix, tea and cooking oil, Wickedly Prime snack foods and now supplements.

The supplements effort comes just as the giant in the space, GNC, is going through a major rebrand in an effort to fight off struggles due to confusing pricing and merchandising. Amazons emphasis on premium quality and transparency in supplements is also an indication that it recognizes the controversy over the ingredients found in many supplements. Supplements in general are under scrutiny from public health officials and state attorneys general, over safety and effectiveness; retailers including Walmart, Walgreens, Target, and GNC have been warned to ensure their safety or remove products found to contain toxic or allergenic ingredients.

Furthermore, keeping some lines of products available just to Amazon Prime members helps make the $99 annual Prime membership fee worthwhile, and the exclusivity of those efforts will help Amazon as rival Wal-Mart steps up its everyday low price promise. Some observers have noted could launch a price war among retailers that sell consumer goods.

Rivals should be worried any time Amazon enters a consumer space: Amazon's private label initiatives are experiencing runaway growth across a range of key product categories, even emerging as the online leader in some categories, according to consumer spending research from 1010data Market Insights unveiled last year.

Amazon Elements in particular is cleaning up market share, increasing 266% year over year according to 1010data. Based on total dollars sold among the top 10 brands, Amazon now controls 16% of the baby wipes market, just behind Huggies(33%) and Pampers (26%).Amazon is dominating when the product categories include commodities, where price stands out as a differentiator, as well as in categories where differentiation is found in the quality and features of a product, e.g. speakers.

No matter the market, the challenge for brands in an increasing number of categories is that Amazon is the top online channel, 1010data senior vice president of marketing Jed Alpert said in a statement emailed to Retail Dive. [T]he bottom line for brands is they can no longer view Amazon as solely a channel and need to acknowledge Amazon as a competitor.

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Amazon's Elements brand adds vitamins, supplements - Retail Dive