Amazon.com, Inc. (NASDAQ:AMZN) has been hiding a secret lingerie company this whole time. According to research by Mike Murphy at Quartz, the company has a collection of brands it has been keeping secret. It uses these brands to sell goods for a higher margin without buyers finding out.
The Seattle firm is known for viciously competing with the companies that choose to sell on its platform. That’s the key to the firm’s success. The secret brand strategy means it may now be doing that on a broader field than ever before.
What are the Amazon secret brands?
The entire article by Mr. Murphy is well worth reading, so if you want the full list of brands you should head over to Quartz.
Among the most eye-catching, however, are lingerie company Arabella; frozen food seller Single Cow Burger; Happy Belly fresh food and spare parts from Small Parts.
Murphy discovered the list of brands by going through patent and trademark filings made by the e-commerce giant. He also came across a group of trademarks that Amazon does own but isn’t actively using to sell on its site.
Previously it seemed that Amazon, as a designer or manufacturer of products, was only competing in the Basics category. That includes things like batteries and paper that tend to be low margin to start with.
Given that it’s building up a portfolio of new brands, it seems that the firm is looking to compete with a broader range of sellers on its platform. In terms of margins, that could be a good strategy. Both seller and policy maker contentment might be more important to the firm in the long term, however.
Is Amazon stock really safe?
Despite having essentially no profit to show for its work, Amazon stock is not far off of all time highs. Wall Street really trusts the firm’s revenue first philosophy. Even when it’s doing sort of odd things like operating a secret lingerie firm, those who own Amazon stock seem to implicitly trust management.
That’s a self-fulfilling process, and a strong one at that. As share value increased, investors have more trust in Amazon.com, Inc. (NASDAQ:AMZN) As trust increases, so does willingness to listen to management’s explanations of shortfalls. That gives the company a sort of immunity to bad news that has been exceptional.
Despite that, Amazon stock is certainly risky. Though the firm is powerful, there’s a lot of ways it could end up losing its preeminence. Right now, it seems that government action is at the heart of models promising risk at the Seattle concern.
President Donald Trump has called Washington Post owner Jeff Bezos a monopolist on more than one occasion. Even more dangerously for the firm, the new Democratic Party platform includes tough language on competitiveness. The group apparently wants to change competition law so that it looks at suppliers as well as consumer welfare.
These concerns are going to be high for the firm going forward. With it somewhat secretly competing with brands selling on its store, a new “supplier welfare” era in competition law could hurt its long term plans.