Amazon Launches "First Try And Buy" Service, Which Fears Traditional Fashion Retailing.

On-line Online retailers Physical stores and logistics will be the driving force. Amazon The three carriages of growth.

According to the world clothing and shoe net, Amazon has new moves after buying $13 billion 700 million Whole Foods full food supermarket. Last week, Amazon announced the launch of the beta Prime Wardrobe "first try and buy again" service. When the news came out, share prices in the US Department stores and fashion businesses fell. The ASOS price of fashion electricity supplier fell 4.8% last Wednesday, J.C.Penny and so on. Department store Retailers fell 5% to 7%.

Why does the new service have such a big influence? The so-called "first try and buy again", that is, Prime members can enjoy the online order, send the clothes that they like to go home and try them on, choose the clothes left in 7 days, and then put the rest in the Prime Wardrobe box to send this special service. As one of the members of Amazon Prime, the service not only sends two-way freight free, nor does it charge extra service charges. You can order at least 3 pieces and 15 clothes at most. The order fee will also enjoy the corresponding discount according to the number of users who decide to leave. Finally, 3 or more orders will enjoy a discount of up to 20 percent off. But at present, the service is in the testing stage, and only invite some members to experience it.

The brand of "Prime Wardrobe" covers "Calvin Klein", "Hugo Boss" and "Theory" and other high-end brands, as well as Adidas, J. Brand, Milly, Milly, J. and Amazon's proprietary clothing brands. At present, Amazon's own clothing brand has reached 14.

Prime Wardrobe services make up for the defects that online shopping can not be tried on, and help solve several problems when consumers are shopping online. The first is the size problem. Consumers do not need to hesitate about the product size table. In the future, they can send different numbers together to go home and try them on, and finally choose their own size. The second is to avoid hasty decisions and give consumers enough time to think about them. They have 7 days to decide whether to keep their clothes.

The further improvement of Amazon's shopping experience will undoubtedly make up for the short board that the electricity supplier can not try on, and at the same time, it breaks the restriction of the physical store's inventory type, and provides consumers with more variety and cheaper products. It is reported that the Prime Wardrobe service will cover more than 1 million kinds of goods.

As the US Department stores are losing ground, the service is undoubtedly adding to the crumbling us department store industry. Macy 's announced that it will close 100 chain stores at the end of this year. The company's net profit in the third quarter was not as good as expected, and it was closing and selling shop assets. According to self shop and authorized stores, Messi store's sales in the third quarter decreased by 2.7% compared with the same period last year, while sales in the same store decreased by 3.3% compared with the same period last year.

Neiman Marcus, a luxury department store, also planned to sell its company or other assets to improve its capital structure in order to reduce its debt pressure of $4 billion 900 million. However, the latest news is that the Group recorded a loss in the three quarter and has given up selling for sale. In the third quarter ended April 29th, the net loss of Neiman Marcus was $24 million 900 thousand, and the profit before EBITDA depreciation and amortization dropped 21% to 136 million US dollars, and sales fell 5% to 1 billion 100 million US dollars. Karen Katz, group president and chief executive, said that Neiman Marcus had stopped negotiations for sale and is now exploring a strategic alternative.

It is worth noting that data show that Macy 's, Kohl' s, J.C.Penny more than 50% of sales come from the clothing business. Under the impact of Amazon, the clothing business of department stores was severely defeated. J.C.Penny has announced that it will rely less on clothing business to save the decline. Cowen & Co analysts predict that Amazon or over Macy s will become the first fashion retailer in the United States this year. Amazon currently accounts for 6.6% of its apparel market share and will reach 16.2% in 2021.

Of course, the fashion apparel is the main target of Amazon since 2012, and has made remarkable achievements since its development. But in fact, Amazon is one of the five most valued companies in the world, and is planning a bigger three-dimensional layout. The fashion map plays an important role in it, and Prime Wardrobe is just a small step in the plan. The ambition behind it lies in the solid penetration of the electricity supplier.

Amazon's route is exactly the same as the current "hot new retail" concept, which is also a new retail experience from the online to offline. In fact, Amazon has embarked on a new retail experiment. In 2015, Amazon opened an Amazon Bookstore in Seattle, and then opened 5 physical bookstores in the United States. In addition, Amazon also launched the first concept store Amazon Go, which is a physical supermarket. Consumers only need to open app and get the goods they want, without party checkout, they can complete the automatic checkout of goods and deductions from the supermarket. It is not hard to speculate that the new retail experience of fashion is also in the planning layout of Amazon. Prime Wardrobe is the first attempt to blur online and offline.

As mentioned earlier, the "door-to-door fitting" service poses the most direct threat to department stores. But Amazon is not just threatening the US Department store industry. For the fashion business, fast fashion, luxury brand, Amazon's role is more and more can not be ignored.

According to earlier reports, ASOS and other fashion oriented e-commerce websites targeting young price sensitive consumers are developing rapidly. They are threatening the traditional fast fashion with more rapid product cycles. But Amazon will no doubt strongly suppress the market development space of the fashion business. Swiss bank analyst Simon Irwin believes that compared with Amazon, the distribution channel of fashion e-commerce is too thin. In addition, the US area still occupies the department store's online store, and the fashion business share is very small.

Whether they are department stores or independent fashion providers, Amazon's logistics services will be their absolute weight. Over the years, Amazon has been committed to the development of logistics technology in the future. Before that, Amazon Prime Air was proposed to focus on the development of UAV delivery. Just last week, Amazon announced its new patent, the giant UAV terminal built by the city center. It is not difficult to understand the operational mechanism of UAV terminal from the following pictures, but to many people's surprise, the multi-storey tower will be built in the center of the city to maximize the efficiency of logistics.

The picture shows the giant UAV terminal built by Amazon new patent city center.

Amazon CEO Bezos believes that in the next few decades, the retail industry will not change three points. First, customers like low prices; second, customers prefer faster delivery; third, customers want more and faster choices.

Over the years, Amazon has been constantly digging up consumer pain points, focusing on improving service technology, while neglecting the fashion of clothing business. At present, Zara and other fast fashion still maintain strong growth, and products maintain higher frequency updates than Amazon. This has become the disadvantage of Amazon in the competition with fast fashion.

At present, Amazon and fast fashion are still checking and balancing each other. But if we look ahead in the longer term, Amazon's technological innovation may have more potential in the future. Solid technological support and infrastructure will gradually widen the distance between Amazon's clothing business and fast fashion. For example, the trend trend database that Zara is proud of is likely to be replaced by big data that Amazon collects from its large customer base. Some analysts believe that Amazon's share price of up to $1000 is based on the market's prediction of its value after 20 years.

Some analysts believe that in the future, Amazon will continue to embrace the middle end and light luxury brands. Nike announced last week that it will enter Amazon to stimulate sales growth and better clean up its direct sales stock. If Nike can sell directly on Amazon, the annual sales volume is expected to increase by 300 million to 500 million US dollars, making the competition for sports goods more intense, Goldman Sachs analysts said. Through cooperation with Amazon, Nike can eliminate excess discounted stock in the market through third party retailers and sell more full price products through online channels.

The brand covered by Prime Wardrobe also includes Adidas, Levi 's and other mid-range brands. As Amazon continues to enter the fashion industry, light luxury brands such as Michael Kors and Kate Spade, which are dragged down by the US Department store industry, are already demonstrating to Amazon.

But luxury brands remain suspicious of Amazon. They always care about other brands, but most of Amazon's products are still popular. Counterfeit goods are also a chronic illness that can not go around in any case. Earlier, the US financial news channel wrote that Amason had always advocated the idea of "user first". However, because of not paying attention to the quality of products, Amason's electronic business platform was gradually evolving into a distribution center for Shanzhai products. If the Amason platform stopped the sale of counterfeit goods, it would aggravate the phenomenon of counterfeit goods flooding through various platforms, leading to a decline in consumer confidence.

Louis Vuitton filed a lawsuit against the Florida state court in May. It said that it found more than 20 sellers selling fake fake LV products with high imitation in the Amazon. 15 suspected infringement trademarks, including LV classic letters and chessboard patterns, caused serious damage to LV's brand image and reputation. Therefore, it was requested that the courts permanently prohibit the sellers from selling counterfeit goods and delete all LV counterfeit products, and required every seller to make a compensation of 2 million US dollars, which involved the amount of the final amount or 60 million dollars. Prior to the LV parent LVMH group has made it clear that its brand will not enter the Amazon platform.

Fakes and fashion may be the biggest weakness of Amazon. But this giant electric provider has always been good at making up for short boards, especially through defensive takeover. To the surprise of the industry, the popular Amazon bought the Whole Foods, an organic lifestyle retailer, for a total supermarket. Amazon has also bought $1 billion 200 million for Zappos, a product known for its rich products and lower prices, which has become a typical example of Amazon's own shortcomings. As more and more millennials of quality and fashion become the main force of consumption, it is imperative to make up for the two short boards.

But Amazon's technology driven, consumer shopping experience is the core of the development path to respond to the needs of future consumers, which will become a permanent driving force for Amazon. The richness of products, the new experience of online and offline, and the fast and convenient logistics, the establishment of a more solid and coherent system for Amazon by the three links.

In the future, the creation of the ultimate experience of the electricity supplier is also the reason why the Amazon "Pandora box" makes the competitors fear.

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