Seattle, WA — Amazon.com, the largest internet-based retailer in the world by total sales and market capitalization, which started as an online bookstore, and later diversified to sell everything from video and MP3 downloads and streaming to electronics, furniture, food, and jewelry, recently launched their own dietary supplements under the Amazon Elements brand.
Amazon first announced the launch of the Amazon Elements brand over two years ago. Its 2014 press release describes the brand as a line of “premium, everyday essentials with transparent origins.” At the time, Amazon Elements offered diapers and baby wipes, but the brand was not very well known and the diaper line was discontinued in 2015.
Now, Amazon Elements has expanded from diapers to dietary supplements. While still maintaining its commitment to transparency, Amazon Elements has shifted its focus to the supplements industry with its initial launch of four products: turmeric root extract, calcium complex, vitamin D, and vitamin K. The products are currently available exclusively by invitation to Prime members.
Amazon’s initiative in the supplement space is well-placed according to Dr. Kurt Jetta, founder of TABS analytics. Jetta noted that private level supplements carry extremely high margins, and “Amazon needs to find ways to improve their margins in e-commerce.” With its approximately 300 million users, more than half of which are Amazon Prime members, Amazon has a large user base. And “what Amazon can do better than a GNC or any other of these niche products is expand on their already-user base, and they can knock down the margins of the industry.”
In addition to its large user base, the Amazon name is trusted among consumers. Amazon has built on this trust with its new QR code reader. In accordance with its original press release from 2014, the Amazon Elements brand offers consumers an “unprecedented level of information.” Each Amazon Elements product includes a unique code on its packaging that consumers can access through the Amazon app to learn “when and where items were made, why each ingredient was included, where the ingredients were sourced and much more — all at their fingertips from the time they start their shopping experience until the items arrive at their door.”
Although the effects of Amazon’s entry into the supplement industry can be critical in the online space, Jetta doubts negative impacts on actual dietary supplement stores. “We would project the impact to brick-and-mortar to be minimal, based on the fact that history has shown both e-commerce and brick-and-mortar can both grow concurrently in vitamins,” he predicts.