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Independent merchants ensure that most Beauty & Hair Care brands can be found on Amazon.com regardless of their chosen distribution strategy. Brands can either engage with Amazon to clean up third-party listings or forfeit control.
L2 Insight: The Amazon Delusion
December 7, 2015
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Luxury brands like Hermes, Chanel, and LVMH have long had a no-engagement policy with Amazon. However, a no-engagement policy in regards to the world’s largest e-tailer is nothing but a delusion. For example, Estée Lauder does not distribute on the platform and has over 7,000 products available on the e-tailer. How is that possible? Those 7,000 SKUs are listed by third party merchants, unaffiliated with Amazon yet responsible for the majority of its sales. Those merchants sold 2 billion items last year, and account for 75% of Beauty listings and 85% of Hair Care listings on Amazon. In exchange for becoming an official seller, Amazon sometimes offers to regulate these third-party sellers. L’Oréal Group, for example, began to officially distribute its Vichy and La Roche-Posay brands through Amazon’s Luxury Beauty store in November. Overnight, the number of Vichy listings on Amazon dropped from 503 to 32, and the number of La Roche-Posay listings dropped from 637 to 57. This is all proof that brands should stop ignoring the world's largest e-tailer and find a way to work with Amazon.
L2 Research Briefing
At this member event, Maureen Mullen, L2 Co-Founder and Chief Strategy Officer, will employ our data-driven approach and tactical recommendations to help brands understand challenges, opportunities, and best practices when partnering with Amazon and how the platform is changing the face of modern retail.