Amazon.com (AMZN 2.48%) has never been a company to shy away from the future. The e-commerce giant has been a fearless early adopter, not only in its initial iteration as an online bookseller but also when it disrupted its own model to pioneer e-books, one of many occasions when it's disrupted itself. It's also been one of the first movers in industries as varied as streaming video and cloud computing.
Now the company is passing along its start-up spirit to its retail partners with its new program, Amazon Launchpad. Amazon describes Launchpad as a platform for start-ups to "launch, market and distribute their products to hundreds of millions of Amazon customers across the globe."
The move seems like a win-win for Amazon and its start-up partners. For the start-ups, the benefits are clear: they can take advantage of Amazon's platform and expertise in marketing and fulfillment to make their products available to a huge audience. Amazon, in turn, makes as much as 20% in commission off of third-party sales on its website, and partnering with these types of innovators could help the company develop a relationship with a startup that comes up with the next big thing.
Source: Amazon.com
Amazon has partnered with start-up incubators such as Andreessen Horowitz, Y Combinator, and Indiegogo to sell products ranging from electronics to kitchen to beauty. Products featured on Launchpad include a Soma sustainable water filter, the eero Home wifi system, and Quinn farm-to-bag popcorn.
While the average customer might struggle to find a need for many of the items on Launchpad, such as Thync Calm Strips, that would seem to be part of the point. If there's been a weakness in the company's "Everything Store" e-commerce strategy, it's that its mission to sell the mundane, everyday commodities that consumers need has come at the expense of niche, independent and creative products -- the type that an Internet user might find elsewhere online. Launchpad seems to be one way to correct that, as it gives Amazon users a section worth browsing out of curiosity, much in the way an 80's mall visitor might stop in at The Sharper Image.
The Shark Tank effect
In this age of wearable technology and the Internet of things, the popularity of the kinds of devices featured on Launchpad seems only destined to grow.
Earlier this year, Amazon launched Exclusives, a platform that now seems to be a forerunner of Launchpad. Like Launchpad, Exclusives has borrowed products from crowdfunding sites, and even sells some things that have been featured on the ABC show "Shark Tank."
The success of that show, which features start-up entrepreneurs pitching new products to a panel of millionaire investors, has shown both the power that a platform like TV can give to start-up businesses and the interest of the average American in such inventive products. One study by Inc. magazine found that just appearing on the show can have major benefits for entrepreneurs, and getting backing can often lead to revenue growing exponentially.
Start-up founders are well aware of that effect, which should make them all the more likely to take advantage of a program like Launchpad. With only about 200 products listed currently, Amazon is starting small, but its popular review system should help the best products get noticed. Like nearly all of Amazon's other initiatives, customers can expect Amazon to quickly expand on the initial effort.
Who knows if Launchpad will lead to the next billion-dollar product? What is clear is that Amazon is once again making a smart bet on the future, and in doing so is distancing itself from the competition even further.
