Nike is just ‘tip of the iceberg’ of companies ditching Amazon
Nike’s decision to stop selling merchandise to Amazon is the start of brands opting to go directly to consumers, says internet entrepreneur Tim Armstrong.
“The direct-to-consumer movement will be the replacement for the retail issues and commerce issues that are going on because of the platforms,” Tim Armstrong told CNBC on Friday.
“If they have the option to go direct, they are going to go direct,” said Armstrong, former CEO of AOL and ex-Google ad chief. Brands are often fearful that by partnering with Amazon they will lose control over how they’re represented on the site.
Nike confirmed to CNBC that a pilot program, launched in 2017, to sell a limited product assortment to Amazon, in exchange for stricter policing of the Nike brand on the platform, will end. Nike said it’s shifting focus to its direct-to-consumer business.
Direct-to-consumer is “another megatrend starting,” said Armstrong, whose company invests in brands that sell directly to consumers.
Armstrong’s optimism toward the growing industry echoes sentiments from analysts, who said this week that they believe other retailers will follow suit after Nike’s announcement.
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