Amazon misses out on Switch 2 sales after Nintendo pulled products from U.S. site

Nintendo Co. pulled its products from Amazon.com Inc.’s U.S. site after a disagreement over unauthorized sales, meaning the e-commerce company missed out on the recent debut of Nintendo’s Switch 2 — the biggest game console launch of all time.

The Japanese company stopped selling on Amazon after noticing that third-party merchants were offering games for sale in the U.S. at prices that undercut Nintendo’s advertised rates, according to a person familiar with the situation. Enterprising sellers were buying Nintendo products in bulk in Southeast Asia and exporting them to the U.S., said the person, who requested anonymity to discuss confidential information.

Nintendo product listings started disappearing from Amazon’s U.S. site last year, gaming news outlets reported at the time. The listings had previously appeared as “Sold by Amazon,” which typically denotes merchandise the online retailer buys directly from brands. Some Nintendo products remained on the site, but they were listed by independent merchants who sell their goods on Amazon’s sprawling online marketplace.

Amazon tried to assuage Nintendo by offering to attach labels to products that guarantee they’re authentic. Amazon uses the technique to assure shoppers products aren’t counterfeits and to help it track merchandise. But the offer wasn’t sufficient, the person said, and Nintendo ultimately opted to pull its products from Amazon in the U.S.

“There is no such fact. We do not disclose details of negotiations or contracts with retailers,” a Nintendo spokesperson said in an e-mailed response, declining to elaborate further.

An Amazon spokesperson said “the claims made by Bloomberg regarding our relationship with Nintendo are inaccurate” but declined to specify how. “Amazon is pleased to offer Nintendo products directly to our customers as part of our commitment to providing an exceptional shopping experience with the widest selection possible,” the spokesperson said.

When Nintendo released the hotly anticipated Switch 2 this month, Walmart Inc., Target Corp., Best Buy Co. and GameStop Corp. all stocked the console in their U.S. stores. Amazon is selling the Switch 2 in foreign markets, including Canada, Japan and the U.K., but the company’s U.S. customers have been out of luck, with some taking to social media to wonder when the world’s largest online retailer might have it in stock. The U.S. accounts for about two-thirds of Amazon’s sales.

Nintendo is hardly the first brand to clash with Amazon over how third-party merchants conduct themselves on the company’s marketplace. Big brands have long said Amazon needs to do more to police independent sellers and tamp down counterfeits. Over the years, brands also have pulled their products from the site because they say Amazon doesn’t give them enough control over how their goods are displayed and sold. Amazon has worked to court high-profile holdouts, including by filing lawsuits against suspected counterfeiters.

In 2018, Amazon and Apple Inc. struck a deal that permitted Amazon to sell the latest iPhones and other products. Amazon subsequently banned unauthorized third-party merchants from selling refurbished products built by Apple. Another one-time holdout — Nike Inc. — recently signaled it would resume selling products through Amazon.

In recent weeks, Nintendo appears to have reestablished a direct relationship with Amazon in the U.S., with preorders for the upcoming “Donkey Kong Bananza” appearing on the site as sold by Amazon. But, as of Friday, there was no Switch 2 listing, and Amazon didn’t appear on Nintendo’s list of retailers in the U.S. that carry the console.

Nintendo sold 3.5 million-plus units of the Switch 2 in just four days, a record-breaking start for the company’s first new console in eight years. The company hopes to sell 15 million units by next March. Gamers from Tokyo to San Francisco lined up for hours earlier this month to get their hands on one of the gadgets. The long-awaited Switch 2 succeeds the hot-selling original, which pioneered a hybrid design that lets gamers play at home on a TV and on the move.

Day writes for Bloomberg.