• Follow us

Economy

Selling with the enemy: Why rival retailers embrace Amazon.com

MADRID/NEW YORK (Reuters) - Chico’s FAS Inc warned in January that it would shutter at least 250 stores across its namesake brand, along with its White House Black Market and Soma labels.

But the U.S. women’s clothing chain is expanding a different storefront - its Chico’s-branded micro site on Amazon.com Inc.

The world’s largest online retailer now sells around 2,300 Chico’s styles, from crease-proof trousers to fine-knit sweaters, representing nearly six times more product offerings than when it started last May, Chico’s told Reuters.

While that growth should entice any retailer, Chico’s is one of a growing number of clothing brands treading carefully.

From Nike Inc and Under Armour Inc to Lands’ End Inc and Levi Strauss & Co, major brands are distributing clothing and accessories directly through Amazon.com, attracted by more than 100 million members of Amazon’s loyalty club Prime and its advanced delivery network.

The risk in this relationship, according to interviews with retailers and industry analysts, comes if Amazon uses real-time data from customer purchases to help it quickly build out its own private label clothing brands, and ends up stealing market share from its current retail partners.

“The word that’s most commonly used with respect to Amazon from a brand perspective, and also retailers to some extent, is ‘frenemy,’” said Kate Delhagen, an independent retail consultant and former senior director of global digital business development at Nike. She had input into Nike’s decision process to partner with Amazon, but left the shoe company shortly before the deal was finalized in July 2017.

Recognizing the concern from retailers, the European Commission has launched a preliminary antitrust investigation into Amazon and whether it might “gain access to competitively sensitive information about competitors’ products which it could use to boost its own retail activities at the expense of third party sellers on its marketplace,” an EU spokesman said.

The company told Reuters it does not use an individual seller’s data to give its private label products an advantage.

It declined to comment on the early-stage probe, or say how many private label clothing brands it had and how fast it was churning out new ones.

A spokeswoman noted that Amazon’s private label products account for about 1 percent of its total retail sales. “Our private brands supplement the great assortment that our selling partners provide,” she said.

A Nike spokeswoman said its business with Amazon continued to perform well, but said the company’s approach was broader than Amazon alone and that it continued to engage with a number of digital marketplaces.

To sell through Amazon, Chico’s and other clothing retailers can either sell product to Amazon in a traditional wholesale relationship or sell directly to consumers as third-party merchants, paying a 17 percent referral fee on clothing and accessories sold.

Retailers pay Amazon extra to store and ship their orders under the ‘fulfillment by Amazon’ model.

Amazon has set a goal of being a leader in the apparel space for around a decade, former Amazon director Mike Pazak told Reuters, and has invested heavily in the sector. It has recently ramped up its own private label apparel brands.

It had 109 of its own brands in clothing, shoes and jewelry categories at the start of 2019, which is more than a five-fold increase over two years, according to TJI Research.

FILE PHOTO: A model is seen during a shooting session for Amazon Fashion at an unveiling of its new photo studio in Tokyo, Japan March 15, 2018. REUTERS/Toru Hanai/File Photo

“It’s something we’re aware of and understand the risks,” said George Nahra, senior vice president of strategy, business development and international at Chico’s, which flies executives to Seattle regularly to review the growing Amazon business.

OVERTAKING WALMART

Amazon markets fashion across the world from Brazil to China. It has made its Prime Wardrobe concept, which allows Prime members to order clothing with no upfront charge and free delivery, available in the United States, Britain and Japan.

The online giant has sponsored fashion weeks in the United States, Mexico, Japan and India and has photography studios for fashion shoots in New York, London, Tokyo and New Delhi. It is a patron of the British Fashion Council.

Following an upheaval of consumer habits, which has led to the shuttering of thousands of small apparel stores, Amazon has overtaken Walmart Inc as the most-shopped clothing retailer in the United States, according to a Coresight Research survey.

In Britain, Amazon has outpaced Marks and Spencer Group PLC as the most-shopped clothing retailer, according to an HSBC survey.

Amazon Prime member Abby Kidd bought a pair of Silver brand $80 jeans the first time she used the Prime Wardrobe service.

“I doubt I’ll look anywhere else for jeans as long as Amazon keeps expanding their options,” said the 35-year-old private tutor, based in Oak Harbor, Washington who also shops at chain stores Macy’s Inc and Maurices.

Classic American clothing retailer Lands’ End turned to Amazon more than a year ago when it looked to increase sales after a bruising exit from previous owner Sears.

“We’d be ostriches sticking our heads in the sand if we didn’t take heed and pay attention to where customers are going,” said Sarah Rasmusen, senior vice president of e-commerce at Lands’ End, founded in the 1960s as a mail-order business.

Lands’ End started selling core items such as flannel shirts and down coats on Amazon in February last year as part of its strategy to branch out from troubled Sears stores, where it has lost dozens of retail locations.

Lands’ End’s key swimwear lines compete with Amazon’s Coastal Blue swimwear private label on the site.

Both Chico’s and Lands’ End declined to say what percentage of their sales were made through Amazon, but said the platform was a useful customer acquisition tool that was not drawing clients away from their own e-commerce sites.

A gripe for retailers is that selling on Amazon loses the direct customer relationship they get from their own website or store.

“You don’t know where your customer’s coming from, you don’t know what they’re clicking on once they get to the site,” said Melanie Travis, founder of upmarket swimwear brand Andie who has talked to Amazon, but decided against selling on the platform.

Others are satisfied with the limited data they get from Amazon. For instance, Chico’s gets enough to mail catalogs to new Amazon customers, said senior vice president Nahra.

Canadian shoe retailer Aldo, which deepened its 10-year relationship with Amazon to a wholesale model this year, said it receives more information as a result, such as the basket composition of customers who buy Aldo’s products on Amazon. That allows it to adapt its product offering accordingly.

Slideshow (3 Images)

Insights shared by Amazon can influence how the retailer designs collections, Aldo said. Its products compete with Amazon’s footwear private label The Fix on the platform.

“There’s an interesting partnership you get by selling to Amazon instead of selling through Amazon,” said Justin Cohen, senior director of e-commerce for Aldo North America. “We’re just starting to lean back into that relationship.”

Reporting by Sonya Dowsett and Melissa Fares; Editing by Vanessa O'Connell and Edward Tobin

Our Standards:The Thomson Reuters Trust Principles.Read More



Leave A Comment

More News

Reuters: Business News

Aramco gets whopping $100 billion demand for landmark 2019-04-09 07:45:15Saudi Aramco has attracted orders in excess of $100 billion for its debut international bond, a source familiar with the matter said.

Selling with the enemy: Why rival retailers embrace 2019-04-09 07:40:15Chico's FAS Inc warned in January that it would shutter at least 250 stores across its namesake brand, along with its White House Black Market and So

EU plans for own retaliation in aircraft dispute 2019-04-09 07:27:24The European Union has begun preparations to retaliate over Boeing subsidies, an EU official said on Tuesday, a day after Washington listed EU product

Big Wynn? Vegas giant makes $7.1 billion play 2019-04-09 07:25:16World No. 2 casino operator Wynn Resorts made a A$10 billion ($7.1 billion) takeover approach for Australia's Crown Resorts, the target company said

China wants to ban bitcoin mining, traders say 2019-04-09 07:18:50China's state planner wants to eliminate bitcoin mining in the country, according to a draft list of industrial activities the agency is seeking to s

EU executive eyeing retaliation against U.S. over aircraft 2019-04-09 07:08:33The European Commission has begun preparations for possible retaliation against Boeing subsidies, the EU executive said on Tuesday, a day after Washin

British retailer Debenhams falls into administration 2019-04-09 07:01:55Debenhams' lenders took control of the ailing British retailer on Tuesday after it went into administration, wiping out shareholders including billio

Oil hits five-month high above $71 on Libyan 2019-04-09 07:00:31Oil hit a five-month high above $71 a barrel on Tuesday, supported by concern that violence in Libya could further tighten supply, although Russian co

Creditors take control of British department store chain 2019-04-09 06:46:52Lenders in Debenhams took control of the ailing British retailer on Tuesday after it went into administration, wiping out shareholders including billi

French bank SocGen to cut 1,600 jobs in 2019-04-09 06:44:35Societe Generale plans to cut 1,600 jobs, mainly at its corporate and investment banking arm, in an attempt to boost profits after a poor performance

Global share rally cools as U.S. turns up 2019-04-09 06:27:49April's equities rally risked running out of puff on Tuesday, as a U.S. threat to slap tariffs on hundreds of European goods and expectations of anot

Sony stock surges after Reuters reports Third Point 2019-04-09 06:25:43Sony Corp shares surged more than 9 percent on Tuesday after a Reuters report saying Third Point LLC was again raising its stake in the Japanese congl

L.A. Times - Business

Trump threatens to tariff EU cheese, wine, helicopters, 2019-04-08 21:25:00The Trump administration is proposing tariffs on new passenger helicopters, various cheeses and wines, ski suits and certain motorcycles in response t

J&J wins trial over retired teacher’s baby powder 2019-04-08 19:35:00Johnson & Johnson won the latest trial last week over claims its iconic baby powder can cause cancer, as a jury in Long Beach rejected a lawsuit b

Chuck E. Cheese’s stock is returning to public 2019-04-08 19:20:00Got some spare tokens? Chuck E. Cheese’s is returning to the public markets. CEC Entertainment Inc., which owns 750 Chuck E. Cheese’s and

New $70,000 pickup trucks come with Mercedes prices 2019-04-08 19:15:00A dusty fracker deep in the North Dakota oil fields scrambles into his shiny new pickup truck and pushes the electronic ignition. He settles in as the

Pinterest sets IPO price range below its 2017 2019-04-08 18:50:00Pinterest Inc. is seeking to raise as much as $1.28 billion in a U.S. initial public offering that could value the company below the amount it reached

S&P 500 ekes out a gain, extending its 2019-04-08 17:55:00U.S. stock indexes took a round trip Monday, erasing their early-morning losses to end the day close to where they started. The Standard & Poor&rs

Tesla starts the quarter by laying off more 2019-04-08 16:20:00Tesla Inc. followed a disappointing deliveries report by cutting another swath of sales staff across the country as the electric-car maker continued t

Univision sells the Onion, Gizmodo and other websites 2019-04-08 12:25:00Univision Communications Inc. has sold tech website Gizmodo, satirical-news hub the Onion and other English-language sites to the private equity firm

Although transgender workers face steep barriers, corporate America 2019-04-08 10:00:00While working at a hair salon in Santa Monica, Ryan Blake played a role. Blake recalls acting like a “stereotypical gay dude” at the busin

California Inc.: Are cashless stores fair to low-income 2019-04-08 08:00:00Welcome to California Inc., the weekly newsletter of the L.A. Times Business Section. I'm Business columnist David Lazarus, and here's a rundown of

Fiat Chrysler teams with Tesla to meet EU 2019-04-08 01:35:00Fiat Chrysler Automobiles is teaming up with Tesla Inc. to comply with stricter European Union emission rules. FCA is using an EU “open pool&rdq

Inflated credit scores leave investors in the dark 2019-04-07 12:25:00Consumer credit scores have been artificially inflated over the past decade and are masking the real danger the riskiest borrowers pose to hundreds of

Economy

Europe slams 'exaggerated' US tariff threat and prepares 2019-04-09 05:45:00The EU has hit back at new U.S. proposals to target European goods with tariffs, following a WTO ruling over subsidies for Airbus.

US threatens to slap new tariffs on EU 2019-04-08 21:10:00The U.S. Trade Representative on Monday proposed a list of European Union products ranging from large commercial aircraft and parts to dairy products

After being rocked by Trump tariffs, the solar 2019-04-05 12:45:00After two years of job losses in the solar industry, a California mandate is welcome and advocates are projecting demand to pick up.

White House planning executive order that aims to 2019-04-05 11:50:00The effort was spurred by the blockage of the construction of the 125-mile Constitution Pipeline from Pennsylvania to New York.

America's bustling jobs market is still leaving some 2019-04-05 11:32:00For those in the labor market, employers and job seekers alike, the details of the U.S. labor market are complicated.

Strong jobs number dashes recession fears and shows 2019-04-05 10:25:00March's jobs growth powered back to a more normal level of 196,000, after February's weakness, suggesting a first-quarter slowdown is fading.

Trump says economy would take off like 'a 2019-04-05 10:11:00"I think they should drop rates and get rid of quantitative tightening," Trump says of the Fed.

Here's where the jobs are — in one 2019-04-05 09:56:00CNBC studied the net changes by industry for March jobs based on the data from the Labor Department.

Job market bounces back in March with 196,000 2019-04-05 08:30:00The numbers came a month after February's jaw-dropping gain of just 20,000, which was revised up to 33,000 in the March report.

Josh Brown: How I explain the stock market 2019-04-05 06:10:00Josh Brown, CEO of Ritholtz Wealth Management, has a good analogy to compare the gyrations on Wall Street to the real economy.

Jamie Dimon: US 'absolutely' right to enter trade 2019-04-04 20:28:00J.P. Morgan Chase CEO Jamie Dimon says there are "serious issues" affecting global companies that need to be addressed.

Friday's jobs report could eliminate market's recession fears 2019-04-04 14:03:00Strong data could help curb market speculation that a recession is coming and that the Federal Reserve could have to cut interest rates.

NYT > Economy

Trump Fed Pick’s Divorce Records Are Put Under 2019-04-01 20:20:10A request by Stephen Moore’s former wife to keep them sealed, which will be the subject of a Friday hearing in Circuit Court, adds to the contro

U.S. Moves to Limit Wage Claims Against Chains 2019-04-01 18:15:55The Labor Department offered a view far narrower than the Obama administration’s regarding companies’ liability for workplace violations b

Lyft’s Shares Jump in Trading Debut, Cementing Rise 2019-03-29 16:26:55An I.P.O. underscored the depth of investor hunger for fast-growing young tech businesses, even if they are deeply unprofitable.

Lyft Prices I.P.O. at $72 a Share 2019-03-29 12:28:03Lyft’s I.P.O. heralds a new generation of Silicon Valley darlings on the public markets. Uber, Pinterest and Slack are expected to follow.

Trump Owns the Economy Now, for Better or 2019-03-28 19:53:10The Federal Reserve has halted rate increases. Tax cuts and tariffs have taken hold. Now the president must prove the naysayers wrong about the future

Huawei Security ‘Defects’ Are Found by British Authorities 2019-03-28 15:20:26Britain bolstered White House claims that the Chinese company poses a cybersecurity risk. But the report stopped short of calling for a ban on Huawei

Is Gig Work a Job? Uber and Others 2019-03-27 12:29:26Lobbyists are pressing legislatures, and sometimes working around them, to keep workers from being deemed employees and save the companies billions.

Samsung Predicts Disappointing Results as Chip Prices Fall 2019-03-25 23:36:51Weaker demand for smartphones in China and elsewhere has put increasing pressure on the gadget industry.

The Great American Cardboard Comeback 2019-03-23 05:19:49“No one is shocked when a paper mill closes anymore. The shocking thing is when one reopens.”

Corner Office: Indra Nooyi: ‘I’m Not Here to 2019-03-22 22:28:42In her conservative Brahmin family in India, education was everything. That prepared her to thrive in corporate America and rise to become chief execu

Faster Tax Cuts Could Be Backfiring on Republicans 2019-03-22 15:26:14Polling shows those getting smaller refunds are less likely to view the tax overhaul favorably, even if their take-home pay grew.

Amazon and Union at Odds Over Firing of 2019-03-20 23:47:40After the company’s plans for a big New York presence ran into labor issues, a union says that an employee was fired for speaking out about work

Business - The Huffington

Icelandic Budget Airline Wow Air Collapses, Leaving Passengers 2019-03-28 06:31:00All flights have been cancelled.

Shaquille O'Neal Joins Board Of Embattled Papa John's 2019-03-22 11:18:44The NBA Hall of Famer will be the first African-American director at the pizza chain.

Oil Giants Invest $110 Billion In New Fossil 2019-03-21 20:00:20Exxon Mobil Corp., Royal Dutch Shell, Chevron, Total and BP together have spent more than $1 billion on public relations since the Paris Agreement.

SEC Urges Court To Hold Elon Musk In 2019-03-19 15:10:22Regulators said the Tesla CEO's defense "borders on the ridiculous" in a filing late Monday.

Exxon’s Climate Denial Set To Face First Public 2019-03-19 05:45:11The oil giant's refusal to answer European lawmakers' questions could result in a loss of lobbying access.

Report: Safety Analysis Of 737 MAX Software Program 2019-03-18 04:24:01Boeing says its safety review met "all certification and regulatory requirements" set by the FAA.

Big Business Spent $1.4 Billion On PR, Advertising 2019-03-14 09:00:11The oil industry “leads the pack by a mile,” with the American Petroleum Institute accounting for nearly half the total.

Inside The Union-Busting Campaign At America's Original Craft 2019-03-12 20:35:36Workers at the 123-year-old Anchor Brewing Co. will vote Wednesday on whether to unionize.

Teamsters Union Faces Revolt From Members Over UPS 2019-03-12 13:33:12Local unions in Pennsylvania say their national leaders seek to implement an agreement they voted down.

Thrilled With Trump's Tax Law: Blue Cross Blue 2019-03-11 22:58:38And Health Care Service Corporation paid no taxes last year.

New York's Iconic Chrysler Building Is Sold For 2019-03-11 07:21:35The owners paid $800 million for the skyscraper in 2008.

Home Page

Direct tax collection may fall short of Rs 2019-04-09 07:28:00The shortfall in direct tax mop-up coupled with lower GST realisation may have implications on fiscal deficit.

Hard times for non-oil CPSEs, likely to report 2019-04-09 07:09:00The last five years have been the worst for listed central public sectors enterprises in 15 years.

Poll of polls: BJP-led alliance to win with 2019-04-09 06:27:00The main opposition Congress and its allies are expected to more than double their seats to about 141 on average

NCLAT may ask Arcelor to deposit Rs 42,000 2019-04-09 06:10:00ArcelorMittal's resolution proposal provides financial creditors Rs 41,987 crore out of their total dues of Rs 49,395 crore

Staying in the slow lane: India's $70 billion 2019-04-09 06:05:00Sales have been plummeting despite Modi's campaign pledges to help consumers. They'll need more than empty promises to start buying.

London IPO for Indian billionaire's financial services firm 2019-04-09 05:53:00Bavaguthu Raghuram Shetty set up UK-incorporated Finablr about a year ago to consolidate his financial-services brands

Cash crunch: Jet Airways fails to pay interest 2019-04-09 05:46:00Jet Airways failed to make a payment on March 19 on account of "temporary liquidity constraints', said the Etihad-linked entity

Ghosn says he's innocent, accuses ex-colleagues of backstabbing 2019-04-09 05:30:00Prosecutors took the highly unusual step of re-arresting Ghosn last week on fresh allegations that he used company funds to enrich himself to the tune

Essar Steel clocks in highest ever production at 2019-04-09 05:29:00Essar Steel has a steel making capacity of close to 10 million tonnes that is supported by a 20 million tonne pellet-making capability

India delays May order for Iran oil, awaits 2019-04-09 05:15:00Washington had given a six-month waiver to eight nations including India, allowing them to import some Iranian oil until early May

JLR India opens booking for locally made Range 2019-04-09 04:45:00Deliveries of Range Rover Velar will begin early next month

Merck climbs 5% to hit a new high; 2019-04-09 04:04:00The stock has surged 37 per cent in the past six weeks after the company announced a dividend of Rs 440 per share.

Insider.pro

Facebook To Raise $1 Billion for Its Crypto 2019-04-09 06:30:00 The social network is seeking venture capital funding for the development of its cryptocurrency project.

Coinbase Pro Lists Three New Cryptos 2019-04-09 05:00:00 The U.S. crypto platform for institutional investors has started to support EOS, Augur and Maker.

IBM Files Patent for Blockchain System for Autonomous 2019-04-08 10:00:00 IBM has just filed a new patent about a system that uses blockchain technology to allow autonomous vehicles to predict the behavior of human drivers.

South Korea Lawmakers Ask Government to Ease Crypto 2019-04-08 08:30:00 A group of lawmakers belonging to different political parties has asked South Korea's ruling party to ease the regulation of digital assets.

G20 To Develop Regulation to Prevent Money Laundering 2019-04-08 06:30:00 Central bank governors and G20 finance ministers will take part in the meeting.

Justin Sun: TRON Will Collaborate With ETH This 2019-04-08 05:00:00 TRON CEO has said that his company will collaborate with Ethereum in 2019.

CME Bitcoin Futures Hits All-Time High 2019-04-07 10:01:45 On April 4, bitcoin futures trading volume surpassed over 22.5 contracts, surpassing the previous record of over 18.3K contracts.

Ripple Co-Founder Donates $25M in XRP to San 2019-04-06 13:02:11 The university initiated the “BOLD Thinking” campaign that has already achieved more than 90% of its $150 million goal.

Royal Bank of Scotland and Barclays to Examine 2019-04-05 15:11:14 Besides Barclays and RBS, there are about 40 companies to test a new blockchain-based platform.

LinkedIn: Coinbase Enters Top 50 Places Where Americans 2019-04-05 13:03:01 The company has ranked at #35th position, while JP Morgan stands at #44.

Huobi Adds Dogecoin to Its Trading Platform 2019-04-05 08:30:00 Singapore-based Chinese cryptocurrency exchange Huobi has just announced it has added Dogecoin to its trading platform.

Google Search Requests For Bitcoin Triple Boosted by 2019-04-05 06:30:00 The sudden rise of the crypto market registered over the past few days has attracted the users' interest in the cryptocurrency.


Disclaimer and Notice:WorldProNews.com is not responsible of these news or any information published on this website.