
Amazon will reportedly soon sell its own private-label groceries - mkolodny
http://techcrunch.com/2016/05/15/amazon-will-soon-sell-its-own-private-label-groceries/
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dexwiz
Most grocery stores have their own brands, even the small to medium regional
stores. So this should not come as a surprise that a large store will develop
its own brand.

What I do want to see is the packaging. Most items are meant to be sat on
shelves, and displayed to the consumers. But Amazon items won't need to sit on
store shelves (just distribution centers) and don't need the packaging to sell
themselves. Will Amazon come up with novel packaging optimized for delivery,
or will it be more of the same?

~~~
cgriswald
As a kid, the grocery store's generic brand came in yellow boxes with black
letter that stated what was in the box (e.g. "Corn Flakes"). There were no
other markings.

I can't see Amazon letting a cereal box sit in front of someone while they eat
and not try to sell them a Kindle.

~~~
notatoad
That sounds like loblaws/superstore's "no name" brand:
[http://imgur.com/aEkQBfx](http://imgur.com/aEkQBfx)

It's actually a really great instantly recognizable brand, for all its
generic-ness.

~~~
skykooler
hey look, it's [https://xkcd.com/993](https://xkcd.com/993) in the real world!

~~~
hbosch
One of the best parts of the movie Repo Man (1980s) was this exact thing:
[http://static1.squarespace.com/static/5583664de4b088692d5198...](http://static1.squarespace.com/static/5583664de4b088692d519822/t/55d8e857e4b07faafaaf06d1/1440278617640/)

Also just an all around fantastic movie in general.

~~~
zach
I must confess that I am old enough to remember that this was based on an
actual brand, "Plain Wrap", which was the store brand of the long-defunct
Alpha Beta supermarket chain:
[https://pbs.twimg.com/media/CU25MNEU8AAbnvx.jpg](https://pbs.twimg.com/media/CU25MNEU8AAbnvx.jpg)

They actually used to stock all the Plain Wrap items in a single aisle, and
the effect was like a consumer sensory deprivation tank.

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freyr
I've inadvertently purchased a lot of low quality junk from Amazon lately
propped up by fake reviews and shady third-party dealers peddling counterfeit
goods. If they want to sell me vitamins and food, they need to fix their
brand. Are they a supermarket that is in control what they sell, or are they a
back-alley bazaar that's strictly buyer-beware?

~~~
joesmo
Be careful if you return too many of those shitty products, they __will
__close your account, even if you have a Prime membership. Amazon is shady as
fuck and an untrustworthy retailer. The way they treat employees is beyond
atrocious. Amazon makes Walmart look ethical and honest in comparison.

~~~
swadfghjkl
Your anecdote is the opposite of my experience.

~~~
sotojuan
Same. Well, just the first point. I've returned a ton of stuff from many
sellers without a problem and sometimes I was not required to return the
actual object (I just got money back).

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ruddct
This should surprise no one. Do you purchase things? Amazon's goal is to sell
you them. Then, after it figures out how you buy them, they'll work their way
up and down the supply chain to improve their margins. Done.

Disclaimer: Former Amazon employee

~~~
ArkyBeagle
Amazon: More Wal-Mart than Wal-Mart.

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dmix
This is how Standard Oil completely dominated their market, vertical
integration brought prices so low no-one could compete.

Once same-day delivery and/or drone delivery takes off I predict the grocery
store market will start to look similar to retail music/book stores.

~~~
saosebastiao
Standard Oil's vertical integration brought low prices to what was essentially
a process that has a single input and a handful of outputs. The vertical
integration of Amazon would involve billions of inputs and billions of
outputs. They aren't even remotely comparable, and it is likely that, due to
diseconomies of scale, a vertically integrated Amazon would be less efficient
than they currently are.

~~~
dmix
I was talking specifically about Amazon Fresh and the retail grocery market.
Not Amazon as a whole.

The input/output dynamics don't change very much in that context (by strictly
producing commodity style products), except the potential for higher-margins
and more efficient distribution channels.

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db1
I cannot foresee how this will play out in the long term for the end consumer.
In the short term, consumers get a whole lot of convenience and lower prices.
What happens after a large chunk of other stores have gone out of business?
How would any new player even approach entering the market? It almost seems
impossible unless Amazon systematically screws up and leaves a gap for someone
to exploit.

~~~
dgacmu
Google Express is an interesting counter to this - the ease of online ordering
while using the local stores as local inventory holders. It mostly works
(though it doesn't do fresh groceries where I am). I comparison shop amazon
vs. whatever's on express, and it's pretty common to find what I want more
cheaply via a local vendor, particularly Costco.

I really, really hope this model makes it possible for local shops to coexist
with Amazon for those of us weird enough to want to shop online. (I say that
because it's worth remembering that nobody posting here is "normal" from the
perspective of consumer online habits.) I can't imagine local places are going
to out-compete Amazon when it comes to high $/lb or $/cm^3 items where the
amortized cost of shipping is low, or cases where it's something with very
slowly-moving inventory, but shipping gallon jugs of vinegar is going to have
a very hard time competing against Costco.

(oblig. disclosure: Google's paying my salary this year but this comment has
nothing to do with me hacking Tensorflow.)

~~~
petra
First : According to research - "Shoppers see value and are willing to pay for
the convenience of these services. A MAJORITY of shoppers consider $6 to $10 a
reasonable fee for delivery to their homes, and $3 to $5 for in-vehicle or in-
store pickups."

And i would add - many would probably be willing to pay something between
those numbers for delivery to a fast pickup point on their way from work.

So what if we start talking about parcel lockers for food(as there are in some
places), which increase last mile delivery productivity 10x according to some
? And if we designed robotic parcel lockers, built to height, so we could
optimize land productivity ? And fully/mostly robotic order fulfillment ? And
once eCommerce takes some grocery share, grocery prices will rise somewhat.
And of course, online will have a larger selection(which tends to impact
prices,by competition).

It's not clear Costco will win.

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fma
Amazon already has their "Amazon Basics" line of products for common items.
Groceries should come of no surprise.

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zengr
Curious, will such a move by Amazon make 3rd party sellers fear them more and
move to other marketplaces like jet.com or ebay.com? Given amazon's margins
really come from its marketplace, they might cannibalize that? Yes, amazon's
value for 3rd party sellers is its massive distribution compared to others but
its a supply/demand game. If 3rd party sellers start to move to other
platforms, maybe jet/ebay can spend more to acquire more demand?

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askyourmother
Given the recent problem with fakes on Amazon I worry when they move to food -
in China they now fake even eggs, rice, amongst others - how will they stop
that getting started sold to their customers?

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kevenwang0531
This is part of Amazon's broader strategy to completely upend traditional
retail. I wouldn't be surprised if Amazon follows up by launching physical
stores in city centers to shelf these private label items, in addition to its
Kindle, Fire TV and Echo products. I can also see Amazon stocking online best-
seller items in these stores and have the stores act as last-mile pickup
locations and drone delivery centers. Just think about the amount of foot
traffic these Amazon stores would generate!

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fblp
I'm suprised no one had mentioned instacart in this thread. Instacart has
partnered with 12 grocery chains in SF. Many of them (including wholefoods)
pay instacart commission and there prices are the same as in-store. With these
partnerships, instacart could deliver greater diversity of products at lower
costs.

They've got a long way to go to, but are building a formidable counter to
Amazons grocery play.

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enibundo
What a stupid idea...

At the point where globalisation is proving to be a very bad idea, amazon
comes out with this.

I will never use this service that's for sure.

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mrgreenfur
Digital wal mart is coming for our grocery stores.

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DiabloD3
So, you mean like how Walmart already is?

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mrgreenfur
Yah pretty much. But for some reason tech people think Amazon is better than
walmart. I'm not convinced we should be enamored with technology and ignore
the actual economics of their business.

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DiabloD3
I wish I could say that this decision is why I quit AmazonPrime and quit doing
business with them already, but I already chose to do that due to how badly
they treat customers, how high their prices are, and how limited their
selection is.

Amazon doesn't provide useful value to consumers anymore, and before they roll
out any more services or private label products, they should step back and see
why all their customers are jumping ship (yes, quite a few people already
have).

Edit: For those downvoting me, explain why you think I shouldn't have quit
Amazon. They do not have good pricing, they don't have a good selection for a
lot of things I want to buy, the Subscribe & Save and Pantry programs are
extremely limited, and they keep shoving programs I can't use at me (Kindle
related stuff, their Netflix and Google Music clones, etc).

I don't see the point in paying a per item price premium on top of a $100/yr
fee for what amounts to a broken UX.

~~~
pbreit
I'm guessing you're being downvoted because no one can figure out which Amazon
you are referring to...certainly not the one selling a massive selection of
items at very competitive prices with fast free shipping and the functional
website located at amazon.com

~~~
x0x0
Or one that mistreats their customers.

I bought mite spray for a plant. The ad showed it come in a sprayer but it
didn't; just a normal bottle. I told amazon that the product page was
inaccurate, but that I had a spare sprayer bottle so I didn't care. They still
refunded the purchase price and told me to keep it.

I lost a shipment of nearly $200 of books: USPS said it was delivered but I
didn't receive it. Amazon send me a replacement shipment via 2-day for free
with zero hassle. When the first shipment showed up weeks later, I emailed
amazon. They gave me a coupon for returning them.

Amazon has proactively refunded movie purchases because they detected
streaming issues. It was my wifi router acting up.

UPS -- _not_ amazon -- had trouble delivering a gift and I had to talk to a
customer service agent at amazon. Amazon gave me two free months of prime for
UPS's mistake.

While I wish they would kick knockoff electronics vendors off their site, it's
hard to say that amazon doesn't take care of their customers.

I'm averaging over 60 orders per year with virtually no hassle. I click and
stuff shows up at my doorstep. It's like living in the future :D

~~~
joesmo
They knowingly sell bad products and when you return enough of them, they'll
close your account. I'd say that's some pretty bad mistreatment for their
Prime customers.

~~~
LukeB_UK
You've made that comment twice on this page with nothing backing it up.

~~~
jxcl
I've read stories like this too:

[http://www.theguardian.com/money/2016/mar/18/banned-by-
amazo...](http://www.theguardian.com/money/2016/mar/18/banned-by-amazon-
returning-faulty-goods-blocked-credit-balance)

