Published on November 15, 2012 | by Jennifer Logan

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Amazon’s high fashion revamp

A model on a catwalk

Luxurious brands are set to be sold on Amazon [flickr]

Whether you are looking for a secondhand book or DVD, the online retailer Amazon is one of the first places to visit.

However, you would not generally think of visiting Amazon to treat yourself to high end clothing.

This could change as Amazon is on course to become the destination for luxury fashion.

Cathy Beaudoin, the president of fashion for Amazon said: “This is a transformative time in fashion and customers, more and more, expect to discover brands from all across the spectrum online.

“Amazon presently has around 165 million customers who love fashion and would love nothing more than a chance to buy on Amazon.”

Investment

Founderand CEO of Amazon, Jeff Bezos revealed to the New York Times that Amazon is going to make a “significant investment ” in attracting brands. And the investment is working.

The company has already signed top designers Michael Kors, Vivienne Westwood, Catherine Malandrino, Jack Spade and Tracy Reese.

Amazon has been selling clothes online for years, but they have never had a real focus until now.

As well as its main site, Amazon bought the shoe site zappos.com for more than $1 billion in 2009, started the shoe site Endless.com and MyHabit, and bought the boutique Shopbop in 2006.

Potential partnerships

As Amazon has already taken on well-known luxury fashion brands, many people question if other big brands will get involved.

Chief Executive of Alexander McQueen, Jonathan Akeroyd told the Financial Times: “It would be naive to say we would absolutely never do anything ever with a company like Amazon. That said, we are increasingly aware of the importance of brand identity online and maintaining it at the highest levels.”

However some brands are not convinced with the new development. “Amazon will never sell Louis Vuitton, because we are the only ones that sell it,” said Louis Vuitton Chief Executive Yves Carcelle. “This is a model of direct control that we pioneered, and I think long term it is the direction that most luxury e-commerce will take.”

Improvements

Amazon is making many improvements already on their presentation as a fashion retail brand. Bezos says the company’s new effort is not about selling clothes at discounted prices, but at prices that ensure that “the designer brands are happy”.

He also believes that despite having taken a low-price approach in other industries, Amazon would not do so with fashion: “There’s a sophisticated markdown cadence in the fashion industry that we think makes sense and we’re basically following that established approach,” Bezos said.

They have also made changes to how the clothes will be presented. Instead of regular product images, models will spin and pose to show off the clothing instead. As well as this, the model’s body measurements and the clothing measurements will be available to help with sizing.

“This is a transformative time in fashion and customers, more and more, expect to discover brands from all across the spectrum online” Cathy Beaudoin

Many big designer brands wish to keep to their traditional retail methods rather than entering this alternative market. But this has raised fears that few people will be able to compete with Amazon.

“It has the latitude to set prices and charge whatever it wants,” Sucharita Mulpuru, an analyst for Forrester Research, of Amazon said. “That is a huge threat for brands.”

Amazon is the web’s largest store and attracts millions of customers each day, which will possibly make it harder for designer brands to reject.

“The amount of eyeballs and traffic and retail dollars that are generated through their website is impressive”, said Alex Bhathal, Co-president of RAJ Manufacturing, which makes licensed swimwear brands like Ella Moss.

But as well as this, Amazon has a huge amount of money. The company is said to have about $5.7 billion in cash and marketable securities and Bezos obviously believes investing in the business is the best place to use it and that this investment in luxury fashion is needed.

This shows that the company can afford to do many things  that some of its competitors cannot.

Competition

More big designer brands are on the horizon though as Beaudoin is said to be currently communicating with Gucci, Prada and Burberry. Surely if these will get involved, there is a great possibility others will reconsider.

“If they get a big brand, the rest will follow,” says Kate Omerod, a retail analyst at Verdict Research. “The luxury sector has traditionally been quite slow but it can’t be a blanket ‘no’ now. They have to seek out online retail. They’re a leader online. Even if it’s only partly successful, the rewards will be huge,” adds Omerod.”

So will Amazon eventually become the first stop destination for us to shop for luxury fashion? Watch this space.

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