Amazon Weekly News Digest - August 21

WITH BOBSLED MARKETING MANAGER TOM CROSTHWAITE

 

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Dear Bobsled Clients,

On behalf of Kiri who’s out of the office this week, I’m sharing our weekly Amazon news digest. I hope that this news digest helps you interpret and analyze the rapidly changing world of selling on (or to) Amazon. We welcome your feedback on this new initiative!


KEY TAKEAWAYS

Landmark Federal Court Decision That Favors Brands

What is it: Skullcandy, a manufacturer of headphones and speakers, is legally challenging an unauthorized Amazon seller, claiming a multitude of infringements. In response, the unauthorized seller initiated a motion to dismiss, but this motion was denied by a Utah federal court, allowing the brand’s claims against the unauthorized seller to proceed.   

What does this mean: This is the first legal case where a branded manufacturer appears to be successfully suing (so far) an unauthorized seller on Amazon. The court’s key findings related to negligence on behalf of the unauthorized seller in respect to Skullcandy’s product warranty, quality controls, and trademark dilution. Therefore, brands who are contending with unauthorized sellers on the Amazon marketplace should be keeping close tabs on exactly how grey market sellers are violating their reseller terms, as such details may be extremely important for any future litigation efforts.

It will be intriguing to watch this case unfold, as a positive end result for Skullcandy will certainly be viewed as a major precedent by other brands, and could be the catalyst for more litigation against unauthorized sellers.


Further reading: Vorys eControl: Recent Federal Court Decision Allows Brand’s Claims to Proceed Against Unauthorized Amazon Seller

New “Top Brand” Badge For Established Brands

What is it: Amazon is testing a “Top Brand” badge that so far has been limited to select searches, mostly in the Clothing and Shoes category, and has appeared in at least two different formats. Amazon didn’t specify how it decided which brand was deserving of the badge, but it does seem they are trying to highlight recognizable, household name brands e.g. product searches for “sneaker” resulted in the Top Brand badge being awarded to products by Adidas.

 
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Example of the “Top Brand” badge. Image Source: Marketplace Pulse

Many are speculating the Top Brand badge is yet another attempt by Amazon to woo established brands and make them feel special on a marketplace that is increasingly saturated by anonymous private label products. Marketplace Pulse commented, “In the future, the badge might function similar to how verified accounts work on Instagram and other social networks. Brands which would get verified on Amazon, and thus receive the Top Brand badge, would rank first and command more trust from shoppers.” Yet, considering the recent blowback from the “Amazon’s Choice” initiative (where it was found that financial incentives were sometimes involved in awarding the badge), Amazon will possibly tread more carefully when it comes to the Top Brand badge.

What does this mean for brands? Established brands who are fortunate to be awarded the badge can reap the rewards of the Top Brand badge which is akin to Amazon’s Choice and Best Seller Badges. Other brands can take solace in the fact that more than three-quarters of Amazon searches are unbranded, and more exclusive bells and whistles for big brands is unlikely to drastically change how consumers shop on the marketplace.

Further reading: 
Marketplace Pulse: Amazon's New "Top Brand" Badge
Bloomberg: Amazon Tests ‘Top Brand’ Label for Some Big-Name Fashion Sellers

Extra Nuggets


MENTIONED IN THIS EPISODE

  • Kiri interviewed Byron Kerr, Director of Marketplaces, or Head of Amazon, for the mattress company, Tuft & Needle on the Ecommerce Braintrust podcast. Check out the episode here.

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