SEATTLE — Amazon is so serious about its next big thing that it hired three women to do nothing but try on size 8 shoes for its Web reviews. Full time. The online retailer is shooting 3,000 fashion images a day in a photo studio using patent-pending technology. Having wounded the publishing industry, slashed pricing in electronics and made the toy industry quiver, Amazon is taking on the high-end clothing business in its typical way: go big and spare no expense. “It’s Day 1 in the category,” Jeff Bezos, Amazon’s chief executive, said in a recent interview. Though characteristically tight-lipped on bottom-line details, Bezos said the company was making a “significant” investment in fashion as it tried to convince designer brands that it wanted to work with them, not against them.
The traditional retail world — and many major brands that want no part of Amazon — are gearing up to fight for their lives. “It has the latitude to set prices and charge whatever it wants,” Sucharita Mulpuru, an analyst for Forrester Research, said of Amazon. “That is a huge threat for brands.” Amazon has sold clothing for years. But recently it has focused on signing on hundreds of contemporary and high-end brands, including Michael Kors, Vivienne Westwood, Catherine Malandrino, Jack Spade and Tracy Reese, and it continues to prowl for more.
Amazon’s decision to go after high fashion is about plain economics. Because Amazon’s costs are about the same whether it is shipping a $10 book or a $1,000 skirt, “gross profit dollars per unit will be much higher on a fashion item,” Bezos said, and it already makes money on fashion. While its MyHabit site, started last year, uses a flash-sale model to compete with Gilt Groupe, Bezos says the company’s new effort is not about selling clothes at deep discounts but at prices that ensure “the designer brands are happy.” The ramp-up has created buzz as the company has hired models, stylists and makeup artists, started using customer data to personalize brand and size search results, and as it runs the first advertisement campaign ever, in print and outdoors, for the Amazon clothing store. In the retail clothing world, fears are growing that few will be able to compete with a stepped-up Amazon.
The traditional retail world — and many major brands that want no part of Amazon — are gearing up to fight for their lives. “It has the latitude to set prices and charge whatever it wants,” Sucharita Mulpuru, an analyst for Forrester Research, said of Amazon. “That is a huge threat for brands.” Amazon has sold clothing for years. But recently it has focused on signing on hundreds of contemporary and high-end brands, including Michael Kors, Vivienne Westwood, Catherine Malandrino, Jack Spade and Tracy Reese, and it continues to prowl for more.
Amazon’s decision to go after high fashion is about plain economics. Because Amazon’s costs are about the same whether it is shipping a $10 book or a $1,000 skirt, “gross profit dollars per unit will be much higher on a fashion item,” Bezos said, and it already makes money on fashion. While its MyHabit site, started last year, uses a flash-sale model to compete with Gilt Groupe, Bezos says the company’s new effort is not about selling clothes at deep discounts but at prices that ensure “the designer brands are happy.” The ramp-up has created buzz as the company has hired models, stylists and makeup artists, started using customer data to personalize brand and size search results, and as it runs the first advertisement campaign ever, in print and outdoors, for the Amazon clothing store. In the retail clothing world, fears are growing that few will be able to compete with a stepped-up Amazon.
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