Amazon is reportedly getting into the online mattress business, entering a market in which a handful of startups are trying to dominate.
According to a report in Bloomberg, AmazonBasics firm mattress, which sells starting at $130, was found by TJI Research late last week. The firm monitors the list of more than 120 private label Amazon brand products that now includes kitchen goods, clothing, batteries, and electronics. It also has its own line of furniture that includes Amazon bed frames and bedding, reported Bloomberg. The mattress marks the first time Amazon sold a branded Amazon mattress, noted the report, citing TJI.
Retailers, including Amazon, have been picking up the pace of creating their own products under their in-house brands. For Amazon, Wall Street is bullish on its prospects. This past summer SunTrust Robinson Humphrey, the Wall Street firm, projected the Amazon private label business could see revenues of $25 billion by 2022. SunTrust analyst Youssef Squali said the venture could send shares up more than 21 percent over the next year. As a result, he increased his price target from $1,900 to $2,000 a share, CNBC reported at the time. “As strong an eCommerce platform as Amazon has become over the last 20 years, we believe that the best has yet to come,” Squali wrote in a note on Monday (June 4). “Private label is one of the highly under-appreciated trends within Amazon, in our view, which over time should give the company a strong … competitive advantage.” In terms of clothing and footwear on Amazon, the eCommerce retailer’s own private labels are the fourth most purchased brand, “with only Nike, Under Armour and Hanes ranking higher,” Squali wrote in a note. Overall, the bank projected that private label sales could bring in $7.5 billion in sales on the company’s site this year.
In 2017, an analyst from financial firm Morgan Stanley predicted the eCommerce platform’s private label retail sales could provide an added boost to its bottom lines. Brian Nowak said Amazon’s private label merchandise sales could add $1 billion to Amazon’s bottom line, making up 5 percent of retail sales by 2019, Barron’s reported in October.