ECOMMERCE

Amazon in big apparel move with ‘try-before-you-buy’ service

BY Deena M. Amato-McCoy

Amazon is ramping up its efforts in the apparel market — and challenging brick-and-mortar retailers — with an initiative designed to solve one of biggest drawbacks associated with buying clothes online.

The retailer is preparing to launch a service, currently in beta mode and called Prime Wardrobe, that enables Amazon Prime members to order (and try on) from three to 15 items of clothing before they actually buy any of the items — with no upfront charge or added fee. Shoppers can keep the merchandise for seven days, returning unwanted pieces and paying only for the items they keep.

Some analysts pointed out the new service with its free return will only add to Amazon's already considerable shipping costs. But the online giant has its eye on the prize.

"For now, Amazon appears content to absorb costs and weathering the storm until it becomes the number one fashion retailer in America," Cooper Smith, research director, L2, told Chain Store Age. (For more of his comments, click here.)

Here’s how Amazon Wardrobe works: Prime members browse and order merchandise that features the Amazon Fashion Prime Wardrobe logo. More than a million pieces of clothing and accessories are eligible, according to Amazon, with brands ranging from Calvin Klein to Levi's.

To place an order, customers must select at least three items, which are shipped free of charge. As an incentive to encourage sales. Prime members who keep three or four items will receive a 10% discount off their order. If they keep five or more items, the discount jumps to 20%.

Unwanted items can be shipped back in a return-ready resealable box that has a pre-paid returns label. Packages can be left on shoppers’ doorsteps, or brought to a UPS shipping location. Returns are also free.

While the program has yet to launch, there is already speculation about how Amazon could expand the service. The online giant could link Amazon Fashion and Prime Wardrobe with Alexa’s conversational commerce functionality, a move that would help consumers make fashion choices via the Echo Look camera and artificial intelligence (AI)-powered style checks, according to Seeking Alpha.

Amazon is certainly not first out of the gate with a “try before you buy” online concept. Some retailers, from Stitch Fix to Trunk Club to the new bridal start-up Floravere have even built their business models around the experience. But unlike some of these other players, Amazon Wardrobe does not charge a styling fee. Also, shoppers pick out their own clothes.

Similarly, electronics giant Best Buy recently launched its version of a try-before-you-buy program. Through a partnership with Lumoid, Best Buy’s program enables shoppers to give electronics gear — from cameras and audio equipment to fitness trackers — “a trial run” at a fraction of the cost of making a purchase.

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ECOMMERCE

Commentary: Amazon accelerating e-commerce disruption of apparel

Apparel is at a tipping point. E-commerce currently accounts for 17%-20% of total apparel sales in the U.S. Historically, when e-commerce surpasses the 20% threshold of a retail category Amazon comes in and makes a big wave, because Amazon is the main beneficiary of e-commerce capturing half of all growth in online retail. We’ve witnessed it time and time again in both media and electronics, and now it’s happening in apparel.

Amazon will accelerate e-commerce disruption of apparel by launching new services, such as Amazon Prime Wardrobe which was announced Tuesday. Dressing rooms have been a competitive advantage for traditional department stores, but now Amazon is offering dressing rooms as a service and putting them in shoppers’ homes. This is yet another nail in the coffin for traditional department stores.

The last hurdle Amazon still has to overcome is how to handle the lavish cost of free returns for customers. Over time, Amazon will use predictive analytics to make better, more accurate product recommendations (like it does for household items with Prime Pantry). For now, Amazon appears content to absorb costs and weathering the storm until it becomes the number one fashion retailer in America.

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REAL ESTATE

Mini-Bellagio fountain debuts at Plano center

BY Al Urbanski

Will public spaces be the new anchor tenants in the shopping centers and mixed-use facilities of the 21st Century?

That’s the opinion of J. Wickham Zimmerman, whose construction company Outside the Lines is unveiling a Bellagio-esque fountain that will present choreographed water shows at Legacy West in Plano, Texas.

“Retailers recognize the importance of integrating thoughtfully designed gathering spaces and artful show fountains to drive foot traffic,” Zimmerman said.

OTL’s fountain will cover 3,500 sq. ft. across three basins. It incorporates 131 nozzles and 398 LED lights to produce programmable water displays synchronized to 14 songs.

One of the largest mixed-use developments in North Texas, Legacy West contains 415,000 sq. ft. of retail and restaurant space, a 55,000 square-foot food hall; more than 1,300 luxury residential units, and a 303-room Renaissance Legacy Hotel.

The project’s developer, Fehmi Karahan, said he envisions the fountain becoming the “hallmark of Legacy West.”


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