‘Much ado about nothing’: Amazon, seventy fashion brands for only 1% of revenue
It is the least important category in the sales of the group’s own brands. Out of the ten firms that are less profitable, nine are of women’s fashion
Amazon, the fashion player? Not for now. The e-commerce number one and the second largest distributor of clothes in the United States has tried everything to become a clothing player in its own right, but all that ado has not been translated, at least for now, into sales. The more than seventy fashion brands which group has barely occupy 1% of its own offer’s revenue, and ten of the firms that are less profitable are specialised in that sector.
Earning shares in the fashion market has been, together with food, one of Amazon’s obsessions. Whilst in large consumption the corporation made use of its checkbook to acquire Whole Foods, regarding fashion the titan has tried to replicate the strategy of its main rivals in the United States, the department stores, launching its very own fashion firms.
Originally, Amazon aimed at the release of basics firms for its local market, but last year it took a step forward with the development of its first firms coming from Europe, for which it counted with suppliers of giants such as Inditex.
Moreover, the corporation has invested in the launch of specific services for this sector, like Prime Wardrobe, to try on clothes at home for free; Amazon Scout, a tool similar to Pinterest, or a partnership with Snapchat to search for articles visually in the platform.
However, all these efforts have not been shifted towards sales. From the almost one hundred own brands of Amazon, an 88% are specialised in fashion and, out of them, 60% are targeted mainly towards women, according to a study elaborated by the searching tool JungleScout which analyses only the offer of the United States.
Nevertheless, the own offer of the group generates a negligible 1% of the company’s own firms’ total sales which, at the same time, have a minimum relevance in the volume of the global business.
All own firms (including Whole Foods, Echo and Fire) of the giant led by Jeff Bezos barely represent a 1% of sales, ahead of the 20% which the own brands of Macy’s occupies, Kohl’s 45% or JC Penney’s 52%.
Furthermore, nine out of the ten Amazon brands that produce the less profit are precisely included in women’s fashion and, according to the report, 82% of these category’s firms sale less than one hundred items per month. Contrarily, the group has managed to have better results regarding men’s fashion, despite operating only with thirteen firms (compared to women’s fashion’s 38). In fact, the third most sold brand of the group is Goodthreads, specialised in clothing for men, which has a revenue of 26,621 dollars per month
Amazon Basics, the ‘top sales’
The report shows off the huge distance there is between Amazon’s first most sold own brand and the rest of them. At the top are situated Amazon Basics, which distributes articles of large consumption from scissors to batteries, and which has 604,500 dollars of revenue per month, is almost three times the next most sold firm.
The silver medal is for Presto, specialised in detergents and other home articles, with 108,735 dollars of monthly revenue. In the third position is Amazon Essentials, with 89,272 dollars of monthly sales.
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