Nike stops selling directly on Amazon
The popular retail manufacturer will no longer sell its athletic goods directly on Amazon’s e-commerce platform.
The athletic apparel giant intends to work with brands that mutually build the brands’ awareness by separating Nike’s goods from its competitors in their retail locations, whether physical or online. Almost 70% of Nike’s annual sales are made through wholesalers, down from just over 80% in 2013.
Nike originally took part in Amazon’s brand registry program two years ago with hopes that the “small pilot program” would provide the retailer with greater control over the branded goods that were being sold on the online shopping platform, as well as provide consumer data and add additional powers to help combat counterfeit listings.
Amazon runs an online selling platform which acts sort of like digital flea market where vendors can sell their products or re-sell wholesale goods and pay a share of the sales amount after the product is sold.
But Nike failed to take control of the Amazon marketplace as the majority of third-party listings that were flagged simply opened new accounts under different names and continued as before. Other major brands have also expressed their dissatisfaction that Amazon doesn’t do its part to fight counterfeit sellers.
On top of everything, when the partnership started, the official Nike product listings had less reviews than the established sellers who were already on the platform, thus the official products were ironically ranked worse in the search results due to how the Amazon’s ranking algorithm works.
Putting an end to the partnership between Nike and Amazon will not sever all ties between the companies, however, as Nike said it will continue to use Amazon Web Services’ cloud computing tech to power its services. Nor does it mean that Amazon’s e-commerce platform will no longer feature Nike brand apparel.
“Just because Nike walks away from Amazon doesn’t mean its products walk away from Amazon and doesn’t mean its brand problems disappear,” said James Thomson, a former Amazon employee who now helps brands sell products online through Buy Box Experts. “Even if every single Nike product isn’t on Amazon, there will be enough of a selection that someone looking for Nike on Amazon will find something to buy,” he added.
Following the announcement, Nike shares rose as much as 1.4% in the US Market on Wednesday, while Amazon was down by as much as 0.6%.