Amazon Creates Potential Edge for Major CPG Brands

Amazon set the Internet aflutter when it announced its latest digital innovation the Dash Button. Major CPG companies like P&G, Clorox, Coca-Cola and Kraft are already on board with the e-commerce giant testing with Amazon Prime members. It is already being said that these in-home buttons could give big CPG players the 'leverage they've lacked in e-commerce.'

RIS Newsreports that the Dash Button is a finger-sized plastic button that is installed in the home via adhesive and allows users to reorder common household items by simply pressing it when supplies are running low. Each button corresponds to a unique product — over the washing machine a Tide button could be lying in wait for detergent levels to reach bottle shaking levels, while up in the kitchen the Kraft Macaroni and Cheese button can be stuck to the pantry door and pressed when the last box is cracked open.

Amazon Prime users are currently able to receive the Dash Buttons on an invite-only basis as the retailer tests the service before an anticipated wide-scale rollout. According to the new tech's landing page the "Dash Button is simple to set up. Use the Amazon app on your smartphone to easily connect to your home WiFi network and select the product you want to reorder with Dash Button. Once connected, a single press automatically places your order. Amazon sends an order alert to your phone, so it's easy to cancel if you change your mind. Unless you elect otherwise, Dash Button responds only to your first press until your order is delivered."

In anticipation of a successful launch Amazon has already announced Dash Replenishment Service (DRS) and is inviting product manufacturers to begin implementing the Dash concept into their designs. Manufactures can build a physical button into their device or measure consumable usage that automatically triggers a reorder when supply levels are low. Top manufacturer's including Britta, Whirlpool and Brother have already signed on the DRS and will be among the first to implement DRS when in launches this fall.

According to AdAge, Amazon hasn't said exactly how the model would work, but Dash could easily become a conduit for trade-promotion funds as brands bid for buttons, which would be like miniature end-caps in millions of homes.

"One of the key barriers for many consumers to participate in subscription models is the need to predict your usage," said a K-C spokesman. By participating in Dash, he said, "we are able to offer consumers greater control on when their next order of Cottonelle or Huggies will ship."

Click here to read the AdAge article in its entirety, including more industry commentary.