business
Why private labels are crucial for marketplaces
Jun 30, 01:06

Private labels are gold mines for marketplaces such as Amazon and Flipkart. The companies now have their own products in a raft of categories like electronics, apparel, furniture etc. So far there were no rules on whether or not marketplaces can sell such products. But the debate has intensified, with government asking marketplaces not to use seller data to their advantage. Marketplaces typically scoop up seller data to launch competing items with better pricing/features. Unlike sellers from whom they earn commissions, Private labels offer full profit from sales at nearly 4-6x across categories. Private labels pave the way for dominance as they can help push third party brands to increase ad spends.

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