Amazon updates sales strategy for underperforming products

By

Gabriella Lacombe

Published
Dec 19, 2018

Amazon is set to update its sales strategy, eliminating some underperforming products from its platform and rethinking the way it sells others. 

These items, referred to internally as "CRaP" or "Can't Realize a Profit" according to a Wall Street Journal report, include items like bottled water and paper towels, which are inexpensive to buy but cost-heavy when it comes to shipping. According to WSJ, these items are set to be removed or sold in a way that is more profitable for Amazon. 

A source familiar with the matter told FashionNetwork.com that Amazon will work to continue to sell some underperforming products in revamped sizes using programs like Amazon Pantry, which allows Amazon Prime members to order single-item household goods in categories like beauty, wellness and grocery. 

The source added that Amazon has also moved to alter its packaging and shipping strategy in ways that suggest an eco-friendly push from the company, with plans to construct cost-effective alterations that also reduce waste throughout the company's supply chain. 

WSJ claims that Amazon is making these changes now because the company feels confident that third-party sellers will be able to ensure that the platform continues to host a wide range of products, even as the number of items sold by Amazon itself is reduced.

Indeed, according to a letter to shareholders released by Amazon CEO Jeff Bezos, more than half of the units sold on Amazon worldwide in 2017 were from the e-marketer's third-party sellers.