Can Amazon break into the fashion business?

In its latest attempt to dominate the entire retail economy, the e-tail giant is selling high style alongside paperbacks, pet toys and frying pans.

By TheWeek.com May 9, 2012 1:42PM

Image: Shopping online (© Comstock/SuperStock/SuperStock)Online retail giant Amazon (AMZN) has "wounded the publishing industry, slashed pricing in electronics, and made the toy industry quiver," Stephanie Clifford says in The New York Times. Now it's "taking on the high-end clothing business." CEO Jeff Bezos is wooing fashion houses and adding a site within a site called MyHabit, which uses new technology to showcase clothes on moving models.


Amazon already sells luxury brands like Michael Kors (KORS), Vivienne Westwood and Jack Spade, and the numbers are promising -- after all, shipping for a $10 frying pan and a $1,000 designer shirt are the same, but the shirt yields a much higher profit.


Can Amazon conquer high fashion?


Amazon is making all the right moves. I think Bezos and Co. are going to pull this off, says Amy Odell at BuzzFeed. "As an avid online shopper," I find the models in motion at Amazon's MyHabit a big selling point. The decision to turn MyHabit into a sleek, members-only site like Gilt Groupe may be crucial to winning over "notoriously finicky high-end brands." But perhaps Amazon's shrewdest investment was sponsoring this week's Met Ball, fashion goddess Anna Wintour's annual party.


But high-end shoppers want to shop, not surf. Amazon has logistics on its side, "but the aesthetics aren't there yet," says Kurt Soller at Esquire. If you want people to spend "more than a Kindle's worth on shirts," you can't have a site "so low-budget that a shopper might wonder whether he's buying counterfeit clothing." Plus, the online world just isn't a place "where your money is recognized." You don't get complimentary drinks or "a sales girl's flirting abilities" at MyHabit.


This could be a winner for everyone. This push by Amazon is clearly "a threat to traditional retailers -- especially department stores," says Walter Loeb at Forbes. But while the online giant is sure to capture some share of the high-end fashion market, it's likely that "the brick-and-mortar stores will survive." Sure, they might have to work harder to keep customers, but if they're smart, they'll become "stronger fashion merchants because they have to innovate as a result of Amazon’s initiative."


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