Amazon is on a tear and ready to shift tactics as it skirts whatever obstacles lie between it and the markets it chooses, from grocery via Whole Foods to luxury beauty — through what sources say is a new deal with Violet Grey.And in another sign of its raw power, Amazon's stock peaked at $1,083.31 Thursday, an all-time high that pushed its market capitalization over $500 billion and briefly made founder and chief executive officer Jeff Bezos the world's richest person, with assets valued at $91 billion.But clearly that's not enough for Bezos or Amazon.WWD first reported Wednesday that the web giant was in talks to collaborate with luxury beauty player Violet Grey. Multiple sources said Thursday that the two have already inked an agreement that has Violet Grey serving up a certain set of luxury brands to sell on Amazon in exchange for a commission of between 20 percent and 30 percent.Linking up with Violet Grey appears to mark a shift in Amazon’s strategy. The company has made a habit of buying its way into new businesses such as Zappos or the still-pending purchase of Whole Foods. It’s also forged ahead on its own, for instance, launching private label apparel goods to satisfy many categories of basics. But this deal opens a third way — a collaboration with an outside platform to help lure new brands and shoppers. If it works, it could provide a model for future growth. Asked about the deal, an Amazon spokeswoman said the company “does not comment on rumors or speculation.” A representative for Violet Grey also declined to comment.But Cassandra Grey, founder and chief executive officer of Violet Grey, said cryptically this week: “I cannot confirm a special relationship with Amazon apart from the fact that I have enormous respect for the company and view the platform as one of the only five distribution partners that matter for digital content producers.”With Violet Grey’s access and influence in the luxury space — as well as its many high-end and boutique brands, from La Mer to Vintner's Daughter — Amazon might be able to add a luxury hue to its reputation as a practical web site for a broad range of mainstream products. But even with a hip new partner, it may not be so easy. Many brands sold through Violet Grey are seen as valuable online offerings that currently do not distribute through Amazon. Many brands are wary of Amazon and third-party sellers who use its marketplace and could dilute their appeal. Birkenstock is one brand with no interest in becoming part of the e-tail giant's sprawling network, and it has taken a strong stand against having any of its product available on the site. In a recent e-mail to its retail partners published by The Washington Post, Birkenstock Americas ceo David Kahan took a hardline with retailers that may be considering selling Birkenstocks to the web site.“I will state clearly, any authorized retailer who may do this for even a single pair will be closed FOREVER. I repeat, FOREVER.” Kahan wrote in the e-mail, referencing retail accounts.Kahan sent the e-mail last week, after Birkenstock learned that Amazon had e-mailed a number of its retailers with an offer to buy inventory.Although the offer was sent to tens of thousands of retailers covering a range of product categories, Kahan said Amazon was “in effect soliciting” Birkenstock retailers to break their sales agreements with the brand, and said the massive company could be legally liable for “tortious interference” with its business.“I have never in my 25-plus years in this industry ever heard of a retailer on such a scale as Amazon actively soliciting other retailers for a brand’s inventory in the case of such a brand choosing not to sell to them,” Kahan wrote.The ceo went on to characterize Amazon’s actions as “unconscionable” and “pathetic” and told retailers that such aggressive management of the Birkenstock brand has “created a market situation where not only is our brand in increasing demand, but our brand equity is maintained across all distribution channels.”Of Kahan’s letter, an Amazon spokeswoman said efforts to expand its marketplace are part of a larger goal “to be Earth’s most customer-centric company” offering “the largest selection, at the lowest price and with the fastest delivery.”“When items are unavailable in a particular geography, we provide customers with selection from another marketplace; while sellers can opt-out at any time, this offers customers a wider selection of great brands and helps sellers increase sales,” the spokeswoman said.While Birkenstock might not appreciate Amazon’s expansionist outlook, it seems to be working well for the company.Amazon said Thursday that its second-quarter sales rose 25 percent to $38 billion. However, net income fell considerably to $197 million, or 40 cents per diluted share, compared with net income of $857 million, or $1.78 per diluted share, a year ago.“Our teams remain heads down and focused on customers,” Bezos said.Looking ahead to the third quarter, Amazon is expecting sales growth to continue by between 20 percent and 28 percent, rising to $41 billion. Profits are less certain, and the company is projecting between an operating loss of $400 million to operating income of $300 million.Moody’s analyst Charlie O’Shea took note of the volatility in the retail market when characterizing Amazon’s quarterly performance as “generally in line with our expectations for revenues” and pointed to the “highly promotional environment in North America” as an explanation for a lower operating income.Amazon is also in the midst of acquiring Whole Foods for $13.7 billion and O’Shea said “volatility is likely to be the norm while this investment cycle continues.” Although antitrust concerns around Amazon have increased since the Whole Foods deal was revealed, the company did not allude to any difficulties when discussing the last quarter on a call with investors.
The Whole Foods deal was not included in the second-quarter results as it has yet to close, but it is expected to be completed later this year, and Amazon’s chief financial officer Brian Olsavsky said the company is looking forward to the acquisition.
“We think they’re very consumer-centric, just like us,” Olsavsky said. “They built a great business.”
EXCLUSIVE: Two and half months after John Targon, cofounder and codesigner of Baja East, was hired as creative director of the contemporary division at Marc Jacobs, he has left the company, WWD has learned. Marc Jacobs International, which is owned by LVMH Moët Hennessy Louis Vuitton, confirmed Targon’s departure in a statement: “John Targon is a talented designer and we appreciate the work he has done here. Ultimately working together did not make sense for the brand and we wish him the best.” Read the story by @jessiredale, link in bio. #wwdnews
@theluxurycollection is officially launching a collection, tapping Sofia Sanchez de Betak for the capsule. Over 30 styles will be featured in the Chufy x The Luxury Collection, debuting next month at Bergdorf Goodman, The Webster, FiveStory and more. De Betak, known as “@chufy,” drew inspiration for the collection from her trips to Japan in the past year #wwdfashion
@lhd, founder and CEO of @thewebster, has teamed up with @lebonmarcherivegauche for the European launch of her ready-to-wear line, LHD. The launch will come with an exclusive pop-up opening today that’s set to run through May 20. Located on the second floor, it carries her debut Miami-themed resort collection, launched in November as see-now-buy-now. #wwdfashion
@longchamp, which marks its 70th anniversary this year, just opened its biggest U.S. store on Manhattan’s Fifth Avenue. On the lower level there’s a floor-to-ceiling display of the brand’s iconic Le Pliage bag – in all of its different colors, shapes and sizes. Customers can also have their product personalized in-store by imprinting names, initials or emblems. #wwdfashion (📷: @ericmtownsend)
“Whenever I’m in that place of sound and music, I don’t have fear or nervousness…This album has a lot of themes of courage and boldness and I want to be the soundtrack for people’s lives. I’ll be so happy if [my songs] evoke strength in people, which I know music has done for me,” says @kimbramusic of her newest album “Primal Heart.” The New Zealand-born singer sat down with WWD to talk about her music, newest tour and connecting with hear fans — read more on WWD.com #wwdeye (📷: @jilliansollazzo)
Luxury handbag resale company @rebagofficial is planning to sell a rare collectible for $70,000: the @hermes White Crocodile Himalayan Birkin. The exclusive Birkin sold for about $100,000 in 2008, when @davidbeckham bought one for his wife @victoriabeckham to add to her collection. Read more about the rare Birkin on WWD.com #wwdaccessories
With her costume pearl necklace and what-you-see-is-what-you-get style, Barbara Bush, who died Tuesday at age 92, was a straight-shooter from start to finish.
Born Barbara Pierce in New York City, Bush served as the 37th first lady, as well as the country’s second lady from 1981 to 1989. In addition to being part of the longest presidential marriage — 73 years — Bush also had the unlikely distinction of having one son, George W., become the 43rd president and another son, Jeb, run unsuccessfully in 2016. Having served as second lady during the Reagan administration’s two terms and lived all over the world during her own husband’s ascending political career, Barbara Bush made it clear that literacy — not fashion — was her priority. Read more from Rosemary Feitelberg’s obituary on the late First Lady in WWD.com, link in bio. #barbarabush #wwdnews
Western and ’90s trends have influenced denim for fall 2018. Think raw, dark and coated jeans mixed with bold prints and tough leather. #trendtuesdays #wwdfashion (Styled by @thealexbadia;📷: @ryanplett)