This week marked the launch of a new line of skincare products, Belei. Belei, a private label brand owned by Amazon is one of 138 such private label brands for the online giant. Behind only Walmart, Amazon is the second largest retailer in the world with $141.92 Billion in sales in 2018. According to Amazon, private label brands account for about 1% of their sales annually, nearly $1.5 Billion.
Amazon has created private label brands for, among other things, clothing, furniture, pet food, household goods and electronics. What is the benefit? Aside from the exclusivity and increased revenues there are some branding benefits to private label brands as well.
Private label branding lets marketers create a unique image, which in return promotes stronger customer recognition. Manufacturers who offer private label branding are able to tailor the packaging and labels to their specific audience. Details such as the product name, description, company logo, and contact information all provide additional touch points to speak to the consumer. Private label brands can personalize a customer’s shopping experience which and lead to a higher customer loyalty.
This creates a unique opportunity which allows for companies to build out separate Brand identities apart from the central, primary Brand. While these new identities don’t want to stray dramatically from the personality of the primary Brand, it allows for wildly different products to speak to different customer bases in ways that can be properly tailored to them.