Is fashion a step too far for Amazon?

For many retailers, Amazon can feel like an undefeatable giant. As if its achievements to date aren’t sufficient, the e-tailer has announced its first foray into private-label fashion brands – but is this a step too far?

Undoubtedly, Amazon has a loyal customer base. The site has 244 million active users and is widely praised for its convenience, prices and extensive choice of products. Jeff Bezos and colleagues also have deep pockets when it comes to fulfilment, which will ensure fashion followers get their purchases as quickly as possible, regardless of cost.

However, Amazon’s widespread appeal may also be its Achilles Heel. If their audience is everyone, how are they going to segment that vision for the highly targeted world of fashion?

To be successful, Amazon is going to have to compete with online upstarts like ASOS and internationally-established retailers like Topshop, which both have a strong following from style-savvy shoppers.

Equally, because they are focused on fashion and fashion only, the likes of ASOS and Topshop have had time to really get to know their customers – not just what clothes they like, but how they shop, what their interests are, what media channels they use. This has enabled them to craft a brand based around a clear picture of their target market.

So, is Amazon trying to conquer too much with a foray into fashion?

If anyone is going to make a new venture yield returns, it’s going to be Amazon. After all, the e-tailer has good knowledge of fashion already, having sold clothes since 2008. It added a series of high-profile names to its repertoire last year, including Hugo Boss and Gucci, and opened Europe’s largest fashion photography studio in London last summer.

Amazon is also investing in a knowledgeable leader to increase its chances of private-label success; the former womenswear boss of Marks and Spencer will be heading up the launch. With a background in how fashion and consumer behaviour, she may have what it takes to ensure Amazon’s new foray is completely customer focussed.

There are two things that will ultimately determine its success. The first is how well it can use the wealth of data it generates to map its fashion offering to potential customers.

The second is a problem that faces all online retailers: how well it can promote its private-label range without potential customers being able to feel and try garments.

While online is ideal for items such as electronics and entertainment, clothes are very visual, and many consumers still treasure the act of going into a store. Fashion shopping is a leisure activity, and asking a sales assistant to bring you a different size is always going to be easier than buying something in two sizes and sending one back – no matter how quick and simple the returns service.

Only time will tell whether Amazon lives up to its self-described vision of ‘the ultimate fashion destination’, but it needs to apply the innovative thinking for which it’s renowned to triumph in a world which values style AND substance.

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Amazon’s Prime Day highlights the gap between online and in-store promotions

You have to hand it to Amazon; never one to stand still, in the last couple of weeks alone, the e-tailer has announced a new one-hour fulfilment service in London for Prime customers, along with a one-day flash sale – Prime Day – held today (15th July).

Designed to mimic Black Friday, although it is unlikely to have the same furore initially, it’s a clever way to clear the decks of unwanted stock, stimulate demand in what is a traditionally quiet retail month, and get more customers signed up to its premium delivery service.

Many online rivals will feel a certain degree of tension about Prime Day; yet again, Amazon is using a loss-leading fulfilment strategy to create marketing headlines. However, it’s not just ecommerce that should be concerned.

The increasing frequency with which ecommerce providers are launching flash sales is widening the gap between what promotions look like online, and what they look like in-store.

Of course, the digital world is always going to move quicker than bricks-and-mortar – it’s a lot easier to roll out something virtually – but the faster shoppers have access to discounts or multi-buy deals on a website, the less value for money they feel they are getting in the store.

To combat this perception, retailers need to be drawing on technology to bring real-time capabilities to the store. For example, rather than building marketing campaigns around direct marketing and paper vouchers, they need to be running ‘on the spot’ promotions through shoppers’ mobile devices when they visit the store.

This way, rather than hitting them with special offers when they’re not ready to buy, they can dangle something real to their agenda at that point in time as they browse the aisles. Targeting consumers’ smartphones also enables them to tailor that offering based on their exact location, or their purchasing history, to make the proposition even more relevant.

Don’t forget – if bricks-and-mortar can get the offer right, it has the added advantage of giving shoppers the chance to touch and try a product before they buy. Online can’t do this, which ultimately limits the appeal of some products.