Amazon is significantly reducing its number of in-house brands amid antitrust concerns and a slowdown in revenue growth, The Wall Street Journal first reported.
Over the past year, the company has decided to eliminate 27 out of 30 clothing brands alone, including private labels such as Lark & Ro, Daily Ritual and Goodthreads. As the brands phase out, only Amazon Essentials, Amazon Collection and Amazon Aware will remain in the clothing sector.
Amazon is also discontinuing private-label furniture brands like Rivet and Stone & Beam.
"We always make decisions based on what our customers want, and we've learned that customers seek out our biggest brands — like Amazon Basics and Amazon Essentials — for great value with high-quality products at great price points," Matt Taddy, vice president of Amazon Private Brands, told Entrepreneur.
Taddy added that the company is getting rid of products that "aren't resonating with customers," and looking "for other opportunities to better meet their needs."
Related: How Amazon Got Americans to Spend $12.7 Billion in 2 Days Without Lifting a Finger
The reduction of in-house brands aligns with Amazon's broader efforts to cut costs, particularly in response to the economic impact of the pandemic. Amazon's private-label sector had 243,000 products across 45 brands at the end of 2020, a number that has now been reduced to less than 20 private-label brands overall, according to the WSJ.
The changes come after Amazon was criticized for using data from its platform to develop products that competed with third-party sellers in a 2020 WSJ investigation, which resulted in then-CEO Jeff Bezos testifying before a Congressional antitrust committee. As a result, Amazon's practice of giving its own brands preferential treatment in search results has been curtailed, impacting its visibility and sales, people familiar with the matter told the outlet.
Amazon has also been accused of selling products similar to those of other brands. In 2018, Williams-Sonoma sued Amazon for allegedly copying its designs; the suit was settled in 2020 for an undisclosed amount.
Related: Own a Small Business? A New Amazon Program Could Help You Make an Additional $27,000 a Year.
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