Daily Management Review

Sale Revenues Top $50 Million for Amazon’s Exclusive Store in the First Year


Sale Revenues Top $50 Million for Amazon’s Exclusive Store in the First Year
In what is the first time that data has been disclosed, Amazon.com Inc said that sales on Exclusives topped $50 million in less than a year since its launch, Exclusives is a platform for products not available anywhere else and includes more than 120 brands.
The sale revenue generated from this platform however represents a tiny fraction of those on Amazon's third-party marketplace platform where other merchants are allowed to sell on Amazon's site. 40 percent of Amazon's total site sales is contributed by the third party merchants.
In what is being viewed as the next best-seller on the marketplace platform, Amazon said the store serves as an important avenue for the retailer to get first dibs on new products.
Through stores like Handmade, which offers hand-crafted items, and Launchpad, which sells crowd-funded products – Exclusive is a wing of Amazon which can be seen as a part of the company’s effort to target niche shoppers.
While not divulging the details, Amazon now plans to expand the site that lists 10,000 products including a bluetooth-enabled "smart bag".
"We do expect the broadening of the product categories and geographical expansion," said Peter Sauerborn, director of business development at Amazon who leads the store.
Brands agree to let Amazon be the exclusive third-party retailer for their products in order to be listed on the site.
The Fulfillment by Amazon program – the huge global network of warehouses that are at the disposal of the company and Prime – its loyalty program are given access to, to the merchants in exchange for the exclusive rights.
"There's a whole new group of consumers (the third-party retailers) can draw to Amazon," said Seattle-based Christine Boerner, who runs Cielo, which sells fashionable metallic pillholders through Exclusives.
Rival shopping sites are also investing in one-of-a-kind merchandise at the same time. EBay Inc is returning to its roots by focusing on unique merchandise sold by smaller sellers.
Amazon’s fulfillment program is increasingly drawing an increasing number of Amazon's third-party merchants. The company said that more than 1 billion items were delivered worldwide and active merchants who used it grew more than 50 percent last year.
An example of why merchants might be interested in Amazon's fulfillment program is Stephan Aarstol, founder and CEO of San Diego-based Tower Paddle Boards who was connected to Exclusives on the TV program Shark Tank.
Aarstol said he expects his merchandise to be available to shoppers across Europe for fast delivery after having shipped "several hundred" paddle boards to Amazon's warehouse in the United Kingdom late last year, something he could not have done on his own.