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Nike has pulled the plug on an attempt to sell through Amazon.com directly after the online retailer couldn’t clean up unauthorized resellers from its website. Despite Amazon.com’s dominance of online retail, Nike has charted a course that may be a guide for other brand name companies.
Nike has pushed more sales through its own channels, both in its own stores and through its apps and website. Khadeeja Safdar reports for The Wall Street Journal:
For years, Nike had refused to sell directly to Amazon, fearing it would undermine its brand. Nike executives were unhappy with how unauthorized sellers continued to be widely available on Amazon, according to people familiar with the matter.
An Amazon representative had no immediate comment Tuesday.
Nike has focused on bulking up sales via its own stores, its apps and its own website. It has pared back the number of retailers it uses and now gets more than 30% of its annual sales from its direct-to-consumer business.
At the same time, Amazon’s website has come under greater scrutiny as the volume of products sold by third-party sellers has exploded. They accounted for 60% of physical merchandise sales on the site in 2018, up from 30% a decade ago. Amazon has made the process to list products so simple that counterfeiters have been exploiting the marketplace, The Wall Street Journal has reported.
Nike’s move could have follow-on effects on logistics companies like FedEx and UPS, which will service brands who lack the large fulfillment network Amazon provides.
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