Amazon has yet to win over the fashion industry, but it’s not for a lack of trying.
In the last year alone, it released two fashion-focused services: Prime Wardrobe, which lets customers try on a selection of styles before committing, and Echo Look, a voice-activated personal stylist.
It also built on its data-driven private-label roster (which includes around 20 brands) with The Fix, a line of trend-driven accessories, and Find, a Zara-esque collection launched exclusively in Europe. In October, it was reported that, in 2018, Amazon will launch an activewear line that will compete with Lululemon and Athleta.
Though fashion brands by and large are still holding out on partnering with the juggernaut, most have felt its effects. (It currently claims a 29 percent share of the U.S. fashion e-commerce market.) Here are five ways they responded this year, as covered by Glossy.
Brands made Amazon’s weaknesses their strengths
Becoming the anti-Amazon, in a sense, by concentrating their efforts on the giant’s shortcomings has proven a popular strategy among brands, especially those in the luxury space.
For some, including LVMH’s 24 Sèvres, that’s included elevating their websites with consistent, quality photography.
Though Amazon has gone to great lengths to upgrade its own fashion photography, including building a 40,000-square-foot photo studio in Williamsburg, its apparel and accessories selection still “reads like commodity,” Kristin Savilia, CEO of online wholesale marketplace Joor, said in June.
It’s leaving an opportunity for brands to step in and say, “I’m going to create a beautiful shopping experience that makes you want to buy the more high-end purchase. Amazon is great at X, we’re going to be great at Y,” she said.
On the same note, down to their packaging, brands are taking more pride in their customer service, a problem area for Amazon.
“When we send an order out, it’s in a marble box, with ribbon, with tissue, with a hand-written note from the person who packed the parcel. No business like Amazon could ever look at that and say it’s practical, but it’s about relationships,” Tom Chapman, co-founder of Matches Fashion, told Glossy this summer.
The shipping race got heated
With shoppers growing accustomed to Amazon Prime, with its two-day delivery cycle — not to mention Amazon Prime Now, which promises two-hour delivery (11 percent of U.S. consumers have used Prime Now, according to a 2017 survey by Magid Associates) — retailers are speeding up their processes. In the name of meeting new expectations, many — including Everlane (in NYC, anyway) — are now offering one-hour drops. Net-a-Porter, Farfetch and Matches Fashion are guaranteeing same-day delivery — some, for free.
“All retailers need to be developing a strategy that allows their customer to get what they want, when they want it.” said Steve Osburn, managing director at management consulting firm Kurt Salmon, part of Accenture Strategy. “This needs to include free, fast and everything in between.”
Retailers leading the shift to quicker-than-same-day shipping
Personalization became a priority
This year, 70 percent of retailers cited personalization of the customer experience as a leading priority for 2017, according to Boston Retail Partners’ POS/Customer Engagement survey.
It makes sense — after all, according to recent BI Intelligence research, personalized recommendations can stop shoppers from bouncing to Amazon. (Without fitting recommendations, 47 percent of consumers seek alternatives on the marketplace.)
Amazon is no stranger to the strategy: Earlier this year, we reported that the company employs advanced personalization algorithms that ensure the products each person sees are those that would appeal to them most.
As wooing and retaining customers becomes increasingly competitive, retailers will have no choice but to make personalization a key priority.
“When you pair [Amazon’s personalization] with its larger selection than any other online retailer, alongside its strengths in shipping and price, they’ll continue to be unbeatable,” Adrien Nussenbaum, CEO of marketplace solutions firm Mirakl, said in April.
Voice became something worth considering
Voice is on the rise, and — thanks to its voice service, Alexa, which gave it the first-mover advantage — Amazon is set to remain the leader in the space, according to L2.
Already, Amazon is directing shoppers to Alexa, granting discounts in exchange for shopping via voice. For brands, that’s raised a red flag — namely, with Alexa, Amazon can control all style recommendations; there’s no opportunity for shoppers to visually scope out options.
“[Amazon] will slowly but surely take control of your preferences so that they’re the ones Amazon makes the most margin on or that are Amazon Private Label,” Scott Galloway, L2’s founder, said in April.
For a fighting chance, brands have started launching Alexa skills and actions of their own: In September, Perry Ellis came out with “Ask Perry Ellis,” an on-demand styling service that drives purchases, using Alexa technology. On the beauty side, the brand Wunder2 debuted an Amazon Alexa skill offering hacks and product recommendations that can be shopped through voice.
Basics became the exception to the rule
Fashion brands aren’t ready to sell their full collections on Amazon, but many have no problem putting their basics on the site. Sales of T-shirts, socks and other staples are behind Amazon’s vast market share — and brands have found they can compete in the category by selling on Amazon, with minimal risk.
According to Maureen Mullen, chief strategy officer at L2, this allows brands to retain some control over their image while continuing to drive customers to their own e-commerce sites.
Calvin Klein is the ultimate example of a brand doing just that: It’s exclusively selling core pieces, like underwear, on the site. Its runway collections, on the other hand, can’t be found on Amazon.
“Elevated, brand-halo products are the things loyal customers will still go to the brand to seek out and buy,” Jessica Ramirez, retail analyst at Jane Hali and Associates, said last month. “Calvin Klein is … suggesting it can split up its product across different channels and still keep that direct-to-consumer moment.”