Solution provider vendors serving the fashion and retail sectors said as Amazon continues to expand and disrupt the market (the latest being its “try before you buy” apparel service), retailers and brands not only need to adjust their strategies and rethink how they’re positioned, but they might also need a new playbook.
Tushar Patel, chief marketing officer of e-commerce software provider Kibo, said, however, the online giant might hit some roadblocks as it beta tests its apparel return program. “Services such as StitchFix have created their reputation on giving the customer a truly personalized experience by sending specially curated apparel,” Patel explained. “As a result, consumers feel less friction throughout the shopping journey. The model is meant to be a time saver as the curated box just shows up and they can easily return what they don’t want or like.”
Patel said with Amazon’s beta program, “I would imagine Amazon may hit some roadblocks in terms of personalization as it doesn’t appear they will offer Prime customers a style department providing the same service.”
Instead, Patel noted that “shoppers will still need to take the time they may not have to browse and choose clothes themselves. In this way, shoppers will lose the personalized experience of being styled by a fashion professional, and gain a bit more friction throughout the purchase journey.”
The cmo also questioned whether Amazon has an easy returns process, “so the question then becomes whether they are really eliminating a barrier to shopping/purchase process?” Patel observed that Amazon is aggressively “pursuing dominance” in the market in key verticals such as grocery, and they also have “deep pockets and a loyal customer base.”
“If this program from Amazon is successful, it may force retailers to look at having better return policies or rolling out similar ‘try before you buy’ initiatives for online shoppers,” Patel said. “Regardless, it will be important for retailers to further invest in their fulfillment options and roll out additional initiatives such as reserve online and pick-up-in-store.”
Adrien Nussenbaum, U.S. chief executive officer and cofounder of software firm Mirakl, said Amazon doesn’t face any roadblocks in the market, and expects the beta of this apparel program to succeed. “Where they don’t have expertise, they will build it quickly,” he noted. “As evidenced by Amazon Business, which achieved $1 billion in sales in its first year, there is virtually no industry Amazon can’t enter and disrupt drastically. They will quickly level the playing field on fashion expertise, and put Stitch Fix and Trunk Club at a significant disadvantage. These other brands offer concierge experiences, but they lack a seamless repurchase experience with extensive product selection. This frustrates their customers and Amazon will alleviate that frustration.”
Nussenbaum explained the retail landscape “has already been transformed by concierge services and by entering the concierge space, Amazon is further validating the demand.”
“It may even put the nail in the coffin for conventional retailers who don’t offer significant product differentiation and can’t keep up with Amazon’s pace of innovation and ability to best serve customer demands,” he added. “Combining the concierge experience with a seamless way to repurchase the same or similar products will be a successful endeavor for Amazon.”
Charles Dimov, director of marketing at OrderDynamics, said for Amazon to succeed with this service, it will need to highly engage fashion brands (ones that are well-established and have a loyal following). “Brands with large numbers of shoppers living far from store locations, or any other large retail center, will probably benefit most from an omnichannel service like this,” he said. “It is about educating those customers about the retailer’s new offering to make it easier and more convenient for them. It is all about the customer experience, after all.”
Dimov said possible roadblocks facing Amazon could include the “willingness of customers to test out the service” as well as support from retailers and brands.
“From a retailer’s perspective, will there be significant additional costs they will have to incur — such as shipping fees or excessive returning inventory?” Dimov said. “Online returns already can approach the 20 to 40 percent range. It also means that a retailer’s inventory is tied up during the ‘trying-on’ phase. These are not show stoppers, but should be considered by the retailer in advance.”
Dimov noted that the greatest benefit of the service “is its extension of the omnichannel shopping experience. It is a new way to make it even more convenient for the customer to shop — and do it the way they prefer. Try before you buy also removes the hesitation that many shoppers have regarding fashion and footwear purchases online.”
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