Amazon enters another category in retail: skin care.
Amazon has increasingly added its own internal brands, including brands of clothing, shoes, snack foods, baby diapers and mattresses. This operation threatens other brands that are currently selling on its platform because Amazon has the power to place its own tags at the top of the list of placements on the website. Other rivals who sell the same items at higher prices may also be threatened by passing sales to Amazon's cheaper alternative.
Amazon currently has 138 private labels, according to TJI, a subscription company that is increasingly following Amazon's forays into retail.
"Our goal is to help customers spend less time and money looking for appropriate skin care solutions," said Kara Trousdale, head of private brand beauty at Amazon. in a statement.
As Amazon grows more and more in retail, it could also start putting its internal brands on store shelves. It's already something that he's already started doing at Amazon's 4 Star, a New York site that sells a wide range of merchandise, ranging from stationery to cookware. Amazon has not been able to modify as much the products sold in Whole Foods stores because the grocery chain's leases stipulate that it must primarily sell food there . But it seems that the group is looking to launch a new grocery store offering more autonomy to choose what he wants to sell.
For Amazon, the move to skin care gives it the opportunity to sell products at higher margins than grocery products. This could have repercussions on beauty brands such as Olay, Estee Lauder and Procter & Gamble Clinic, which manufacture similar serums and make-up removers, as well as retail outlets like Sephora and Ulta, which sell also skin care.
The prestige beauty industry in the United States reached $ 18.8 billion last year, up 6% from last year, according to data from The NPD Group. Sales in the skincare category grew by 13 percent, the NPD Group said, contributing 60 percent of the industry's total earnings. Sales of skincare products reached $ 5.6 billion in 2018.