The announcement of the opening of Amazon Luxury Stores came on September 15th. This is Amazon’s new push deeper into the luxury market. It is a new shopping experience on the Amazon app that will feature both new as established luxury brands in fashion and beauty.
In this article, we’ll show fashion brands what they need to know about this new venture and how it can benefit them.
About Amazon Luxury Stores
Amazon Luxury Stores brands will be available exclusively on the Amazon mobile app, and available to sellers by invitation only. On the customer side, it will be available to eligible Prime members on an invite-only basis, but Prime shoppers can also ask to be invited through the Luxury Stores website.
Later on, Amazon Luxury Stores plans to extend invitations to more online shoppers.
On Amazon Luxury Stores, brands can control how their storefronts look and what they want to sell, as well as manage pricing and inventory.
Amazon offers the tools that they need to make this happen, along with merchandising features so brands can personalize the content in their unique brand voices. This includes enhanced, auto-play imagery and in-motion graphics for immersive storytelling.
This looks like what Alibaba has done with their Luxury Pavilion on Tmall in 2017, which features luxury retail goods. Alibaba managed to attract high-end brands, and Amazon wants that. If Amazon Luxury Stores sees the same level of success, it can have over 180 luxury brands like Chanel, Valentino, and Burberry within 3 years from now. As far as revenues go, Amazon stands to bring in over 100,000 shoppers and $159,000 each in spending within the first year.
Amazon Luxury Stores on the app makes it more convenient and engaging for customers to shop fashion and beauty.
The app offers the innovative “View in 360” technology that allows customers to interact with items for sale before they hit the Buy button. They can view a garment from a 360-degree view along with models providing a visual for a variety of body types and skin tones. It helps customers who find it difficult to shop online for clothes because they can’t try the items on.
View in 360 provides extensive support for size, fit, and even draping of garments. The 360 feature will be available along with the rollout of select garments on the Amazon Luxury Stores launch.
First Featured Brand
Oscar de la Renta, an iconic American fashion house, is the first label announced to partner on Amazon Luxury Stores. This first store to open on the Amazon app features the Pre-Fall 2020 collection and access to the Fall/Winter 2020 collection, which is currently only available on the brand’s website and in their boutiques. They include ready-to-wear items, handbags, jewelry, accessories, and a newly launched perfume. The brand says that childrenswear is also coming soon.
Alex Bolen, CEO at Oscar de la Renta, says that he sees an immense opportunity for growth in joining the Amazon Luxury Stores initiative.
Many of the brand’s customers are already Prime shoppers on Amazon. Amazon Luxury Stores allows the designer brand to cement loyalty with existing customers and get new customers from Amazon as well.
After all, where better to connect with shoppers than where they are comfortable shopping? And Amazon has built a strong reputation for supporting customer service through constant innovation based on customer feedback.
Amazon and Oscar de la Renta have created a launch video that features Cara Delevingne. It celebrates the imaginative way that fashion and technology intersect in today’s world. The video is directed by Bunny Kinney and styled by Jason Bolden.
More brands will launch within Amazon Luxury Stores in the coming weeks and seasons.
Why Amazon Luxury Stores?
Amazon has had a difficult time in the past attracting high-end brands to the marketplace. These brands want to avoid being associated with discount goods and counterfeit products. Amazon experienced this first-hand with Nike closing its Amazon storefront to preserve its brand image and avoid the rampant counterfeiting that went on within the marketplace.
Amazon Luxury Stores is the dedicated platform that will help dispel these fears. It will also help to position Amazon as the place to go to shop for a range of luxury fashion items online. If the venture proves successful, Amazon could also open a similar platform for nonluxury retailers. Every brand on Amazon seeks the same protection for their image and from counterfeiting, as well as more control over their content on the marketplace.
Amazon Luxury Stores Advantages
Without these fears, luxury brands will be able to see Amazon as a great opportunity, just as Oscar de la Renta has. Amazon is the largest US seller of apparel, with customers using their mobile devices to order over 1 billion fashion items in the past year. Amazon fashion customers love app shopping on the marketplace.
Currently, Amazon Fashion is already known as a one-stop-shop for any occasion. Shoppers on any budget purchase apparel, accessories, jewelry, watches, shoes, and handbags from a variety of contemporary, designer, and emerging brands. Amazon Luxury Stores is just a logical extension of this continued effort to expand the marketplace’s wide selection and create new experiences for customers.
Christine Beauchamp, President of Amazon Fashion, relayed that Prime members want to have the ability to shop for their favorite luxury items on Amazon. And so the marketplace is jumping at the chance to open Amazon Luxury Stores.
This gives brands the services and technology they need to build an elevated customer experience, including better security for their brands.
What this Means for Amazon
The move into more luxury fashion can help further extend Amazon’s reach in the retail market.
A recent surge to sell luxury goods online is a great opportunity for Amazon. US eCommerce growth jumped to 44.4% year-over-year in the second quarter of this year when more consumers went online as many physical stores closed due to the coronavirus pandemic. More importantly, this acceleration is predicted to continue. This indicated that customers are more willing to buy more kinds of items online to avoid physical contact, presenting an opportunity for luxury categories.
Amazon can capitalize on the shift of sales from brick-and-mortar stores by capturing a wider share of online shoppers who are looking for luxury brands.
The luxury market is a lucrative one, and Amazon can use its status as the nation’s top fashion retailer to tap into that market. These higher-ticket items stand to boost sales and bring in even greater volume at a time when eCommerce growth is already accelerated.
eCommerce Cons for High-End Brands
We now know the benefits that brands on Amazon Luxury Stores can enjoy. But there are challenges as well. We know that Amazon has to overcome the impression that it is the place to go for commonplace, fast fashion. Luxury brands also still worry at this early stage that history will repeat itself concerning counterfeiting and tarnished images.
Amazon Luxury Stores will have to prove that it can become known as a place for luxury fashion and a place where brands can be protected.
High-end brands must also adjust to the digital environment.
Online stores experience higher return rates than brick-and-mortars because of the difficulty of finding the perfect style and fit. View in 360 will help with this, but return rates are still predicted to be higher online. For instance, Bolen from Oscar de la Renta shared that their return rate was almost 30% in a day compared to single digits at their boutiques.
Final Thoughts
Amazon Luxury Stores promises a high-end shopping experience that aims to attract more luxury brands to its marketplace. Many brands, including the targeted big names in fashion and beauty, are looking to expand online in the wake of coronavirus shutdowns and the resulting boom in eCommerce gains.
Luxury brands stand to reach more existing as well as new customers on a platform like Amazon where customers are nurtured and where they can drive shopper loyalty.
Related content: The New Amazon Counterfeit Crimes Unit
