Brand mission: In the increasingly expensive and confusing world of mobile carriers Simple Mobile offers affordable alternative mobile plan options and phone buying services.
Market insight as to why the product is hot: Phones will continue to be a necessity, however pricing on the newest models and the susceptibility of breaking is driving renewed interest in refurbished / older model phones. While consolidation in the mobile market leaves lower-income shoppers with little options for good mobile service, Simple Mobile has a very simple value proposition and I am sure quite interesting unit economics (wish I was an investor!).
Why will it do well on amazon: People already are active on amazon for phones and phone accessories and it is a natural step for them to extend that to the carrier service itself. I foresee an interesting conversation with Amazon’s team about offering an option to sell the Simple Mobile’s wireless plans through the site, as well. The Fire Phone was a huge flop, but this offer of value to Prime Members makes perfect sense to me.
Brand mission: Japanese products company that develops and distributes premium collectible items. Also involved in animation production and motorsports industry.
Market insight as to why the product is hot: Content and commerce continue to merge and investments in content marketing continue to deliver better, more sustainable customer acquisition/retention benefits than many advertising opportunities. On top of that, anime, cartoons & video games are great merch opportunities for toys, apparel and related product catalogs.
GSC, with their collaborative approach to working with creatives to develop products and GoToMarket strategies sits in an interesting position to provide turnkey programs for an increasingly fragmented video game & content publishing industry.
Why will it do well on amazon: There is an interesting case study of a similar business that exploded on Amazon in sales but have since had issues in scaling due to numerous seller policy infringements.
TeeSpring – a Andreesen Horrowitz portfolio company – provides a screen printing website that allows artists to create and sell their graphic tshirts through their system. TeeSpring has thousands of creatives pooled together creating even more styles of shirts that no one needs to take inventory on (print on demand once the shirt is ordered). It was brilliant, until Amazon started Merch by Amazon (MBA) and now there is a fairly active community on Reddit that debates whether MBA or TeeSpring is a better platform to manage your graphic t-shirt business.
GSC has a similar sized opportunity and can even further their ability to compete on Amazon by leveraging Twitch and Amazon’s growing marketing tools to convert Twitch users to Amazon buyers.
A content publisher meets manufacturer of toys and merch… very intriguing.
Brand mission: Custom wheel manufacturer based in Los Angeles, CA. All of the wheels are built and finished in house with American parts. Founded in 2006.
Market insight as to why the product is hot: Forgiato Wheels have been featured in multiple popular music videos including “Who Do You Love” by YG and Drake, “Sittin Low” by Young Jeezy, and “Okay With Me” by Gucci Mane and 2 Chainz. Several celebrities have publicly shown their vehicles with Forgiato Wheels including Michael Jordan, Nicki Minaj, 2 Chainz and the #2 Amazon influencer for teens Kylie Jenner.
Why will it do well on amazon: More and more people are using part finder/ are using Amazon for automotive needs instead of dealerships. Maintaining an automotive catalog with the numerous variations and high sku counts is a daunting task and not many firms are in a good position to compete. Having said that, the consumer is definitely switching online, with a CAGR online for the category of >16% in 2019.
With over 1.1 million Instagram followers and an established foothold in celebrity culture they would have an easier time overcoming “the cold start problem” and capitalizing on their existing branded search index to capture an outsized share of the market on Amazon.
The wheels on what Goldman Sachs is forecasting here have been in motion for 5 years. The very same manufacturers that produce for the brands that are declining inline with retail Brick & Mortar closures are now providing assortment through the Amazon channel.
This has produced a number of intended and unintended consequence.
Pros for Prime Members: – More offers for clothing, as brands in this segment are seemingly the most averse to Amazon’s shopping experience. – More offers means more competition for their wallet, as offers increase the product quality will increase & more price points will emerge as niche opportunities on Amazon.
– Apparel retailers are amongst the least likely to have preferable shipping options for consumers. With Amazon’s convenience of shipping and other Prime Benefits, with any amount of effort paid to how Prime Members discover the right items, Amazon is in a terrific position to offer not just Fast Fashion, but “Fashion at the Speed of Amazon.” – Direct to manufacturer supply chains offer the upside of more supply chain visibility & less ecological impact (clothing is pretty shitty for the environment it turns out).
Cons for Prime Members: – While the selection has increased, I am not sure the “Quality” of offer or shop-ability of Amazon’s catalog have increased at the same rate. A simple category search term for “womens sunglasses” will show you what I mean.
– There are millions of sellers on Amazon, while the vast majority are “good actors”, there are numerous “Grey” or even “Black” markets that exist. One such risk in buying from unknown merchants/brands on marketplaces is that you run the risk of supporting factories that do not adhere to industry standards in regards to labor rights and the like. – Trying a new brand (especially in apparel/fashion) has so much subjectivity towards it (fit, material type, etc) that Amazon’s return policy might be the only reason Prime Members trust offers today enough to buy for their first date, however; I imagine Amazon will invest in growing this market. Contact us if you want to maximize your opportunity here!
Looks like Crocs and Champion are stealing their clout…
looking at the list of brands that are growing: they all endorse Amazon to 1 degree or another. Those on the decline have a similar issue in common – they neglect their presence on Amazon & eComm in general.
Athletic brands once again command the top-spots among fashion preferences. To wit, Nike saw re-accelerating share gains as the No. 1 footwear & apparel brand and lululemon hit a new all-time survey high. It is now the No. 7 preferred apparel brand (No. 2 for upper-income females).
Vans remains No. 2 footwear brand at 20% share, in line with Spring. In fact, 75% of females prefer an athletic brand of footwear and 87% of males prefer an athletic brand of footwear–both new peaks.
The most notable mover in footwear was Crocs–moving from No. 13 to No. 7 as a preferred brand among teens. Streetwear brand Supreme continues to fade in our survey as do prep brands Ralph Lauren, Vineyard Vines & Sperry. Within the “retro”/90s brands, we saw strength of Champion–now in the top-10 brand list.
Piper Jaffray Investment Research Taking Stock With Teens Survey – Fall 2019 Results