Amazon Brand Gating

For many brand owners, Amazon is a source of concern in their marketing and distribution plans.

Amazon is the largest online retailer, and more than half of all internet product searches start on Amazon’s sites.

Many brand owners are surprised to find that their products appear on Amazon without any permission or involvement from them, and that they cannot ask the company to maintain pricing levels.

But in the past few years, Amazon has been allowing brand owners more authority to influence how their products appear on Amazon.

One way is through Amazon Brand Registry, which we cover in a separate post.

Amazon also allows established brands that are part of the registry to pursue a stricter control: Brand Gating.

Amazon Brand Gating seems targeted at reducing the appearance of counterfeit items on Amazon. The company wants to make sure customers are fully confident in their purchases, and counterfeiting is a huge concern.

Brand Gating allows a brand owner to require Amazon sellers to prove they are offering legitimate merchandise for sale: not knock-offs/fakes, and not “gray market” items obtained (perhaps through faithless factory owners) outside of the brand owners’ legitimate “manufacturer-to-wholesaler-to-retailer” supply chains.

Brand Gating does not allow a brand owner to directly control product prices on Amazon.

But if a brand owner has a strong system of enforcing Minimum Advertised Price agreements with its wholesalers and retail sellers, it can prevent a major source of price deflation: illegitimate resellers.

Amazon is also making it hard for new sellers to become authorized to sell a gated product. In addition to proving the legitimate source of their products (through wholesale invoices, etc.) they are in some cases requiring a substantial fee from resellers.

Going forward, this will have the effect of reducing the number of resellers on “gated” products, thereby reducing the competition among resellers and reducing downward pressure on prices for the product. Many brand owners with gated products will be happy to see the “race to the bottom” on pricing diminished.

Ultimately, Amazon Brand Gating is one piece of an overall strategy of increasing online brand reputation, and enforcing price stability.

Can we help you improve your brand online? Contact us!

NBP DIRECT can sell your brand responsibly, and help maintain the price while growing sales.

Here are some helpful resources on Amazon Brand Gating:

Amazon Brand Gating Official Link (requires registering as an Amazon Seller – not difficult)

Amazon Gets Tough With Third-Party Sellers of ‘Restricted’ Brands

Amazon Brand Gating Effects on Sellers

Brand Gate: Amazon takes action to curb brand counterfeits

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