As a potential FTC antitrust lawsuit looms in the background, Amazon plans to reduce its in-house brands. According to The Wall Street Journal, the retailer will eliminate 27 of its 30 clothing brands and all of its private-label furniture lines. It isn’t clear how many other areas the cuts could affect, but the Amazon Basics brand appears to remain largely, if not wholly, intact. The retailer told the WSJ that it looks to eliminate products that “aren’t resonating with customers.”
Among the Amazon clothing labels reportedly being phased out are Lark & Ro, Daily Ritual and Goodthreads. (Amazon Essentials, Amazon Collection and Amazon Aware will reportedly remain.) Meanwhile, the retailer is allegedly dropping its Rivet and Stone & Beam furniture brands once their current stock is depleted. “We always make decisions based on what our customers want, and we’ve learned that customers seek out our biggest brands — like Amazon Basics and Amazon Essentials — for great value with high quality products at great price points,” Matt Taddy, VP of Amazon Private Brands, said in a statement to the WSJ.
Although Amazon didn’t explicitly connect the changes to the expected FTC lawsuit, the timing seems unlikely to be coincidental. Company representatives will reportedly sit down next week with FTC chair Lina Khan and commissioners Rebecca Kelly Slaughter and Alvaro Bedoya. The chat is viewed as a “last rites” meeting, giving the company one final chance to sway the government agency to back down before a filing decision. The anticipated lawsuit culminates a four-year investigation into the company’s alleged anticompetitive practices. It also faces a separate FTC lawsuit related to tricking customers into Prime subscriptions.
Part of the FTC’s interest reportedly lies in Amazon’s dealings with third-party sellers, a longstanding point of focus in antitrust arguments. The WSJ reported in 2020 that Amazon employees used internal data about third-party sellers to create in-house products. That led to the company agreeing to stop boosting its in-house brands in search results, making them harder to sell.