Why American eCommerce Giants don't Develop their Own Brands?

TMO Group TMO Group

eCommerce originated in America. Regardless Amazon, eBay or Bestbuy, they only sell some inessential products such as small accessories. They never focus on their own brands. Others like REI, Backcountry, they develop their own brands just from offline to online.

Basically, they usually only display their own brands online and never use some particular selling strategies. Even they don’t have online-proprietary products. Why America eCommerce giants don’t develop their own brands?

American eCommerce is different from China. They enter the eCommerce field earlier than others. Some big brands like Sony or The North Face, they have their own “Brand Zone”. So one reason is that there is not much opportunities for other online brands to show their products.

America eCommerce

At the same time, many famous brands in America have developed official eCommerce websites to meet their own needs. These websites also have a perfect shopping system, which is not inferior to Amazon. One famous example is Apple. Their website ranking in eCommerce field maintain the top 10 in America. American eCommerce brands owners prefer carry out their own duties. After they have an omni channel retailing, some of them will consider to develop the second brands.

Another reason seems to be more reasonable. Many clothing eCommerce companies are originated in department stores such as Macy’s and Nordstrom.com. Customers can try on some products in brick and mortar stores. They have quantities of offline shops and a mature supply chain. It is unnecessary to prepare their own brands.

In China market, many eCommerce owners are busy at the “Price War”. To a certain extent, they “kidnap” the brand owners. That makes many brand owners official websites seem like a display website. It doesn’t have some essential functions and lack of logistic supply channels.  Above all, the purchase channel in China is near monopoly. Taobao and JD occupy nearly 80% of China eCommerce market. They will be given more say in eCommerce. So many brands owners have to focus and rely on them.

China eCommerce

In general, American eCommerce owners play their deserve roles. China eCommerce is the way of  “sell goods in order to obtain users”. Profit is the ultimate reason why both of them do not prefer their own brands.

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