Amazon is working fast and furious to crack the fashion code for the 21st century.
The e-commerce goliath has a host of initiatives that — while not directly connected — all seek to bring it closer to the fashion consumer, inject the brand into the style conversation and take advantage of its ever-growing bag of technical tricks.
The latest is “Style Code Live,” a streaming show that premiered Tuesday. It has a softer touch than an infomercial — there are no direct calls to purchase — but is still very much a commercial venture, with hosts gushing about their favorite styles and beauty products, all available for purchase from a carousel below the video.
Rachel Smith, a correspondent at ABC News for “Good Morning America” and one of the show’s hosts, described the carousel of products as “sort of like walking through an aisle of your favorite store except in the comfort of your own home.”
It’s an aisle, however, out of one of the largest and most far-flung stores in the world. This is Amazon’s version of omnichannel, putting an entertainment spin on its fashion business and chasing the have-to-have Millennial shopper. And it’s an effort to speak to them directly though a live-chat function.
Edward Yruma, an equity analyst at KeyBanc Capital Markets who has been closely tracking Amazon’s fashion business, said the show is “really trying hard to target a very fashion-conscious, fashion-forward twentysomething-year-old female.”
“This is a really innovative thing that they’ve tried,” he said. “They’re not just copying from the traditional department store playbook. They’re trying to innovate here and I think over time, it will really give them credibility with the fashion community. It’s fashion-meets-entertainment and that’s part of what makes the show attractive. It’s got a little celebrity shtick to it and it’s got a self-help shtick.”
Yruma said Amazon is playing a long game in fashion, being careful to court tastemakers and build support. Amazon has also quietly rolled out private-label apparel and has been advertising for fashion executives to help supercharge that effort.
An indication of the potential for Amazon was also indicated Wednesday at the UBS Global Consumer Conference, where Nordstrom’s chief financial officer Mike Koppel said he has heard that Amazon’s fashion business has grown to $10 billion. Koppel said Nordstrom is clearly aware of Amazon since both companies are based in Seattle. The department store retailer has always seen Amazon as a threat, and believes Amazon will be good at basics, but not as good at fashion turns.
Others aren’t so sure. “The traditional apparel market’s going through a lot of disruption, so in a way the time is ripe for Amazon to come in and do this,” Yruma said of the company’s fashion initiatives. “The secular growth rate for apparel has been challenged for quite some time, so even modest market share gains by Amazon can be material for a lot of struggling retailers.”
The e-tailer is growing to be a formidable presence in fashion, carefully bolstering its bona fides, sponsoring a fashion week in India, advertising in GQ, and paying The Blonde Salad blogger Chiara Ferragni a reported $300,000 to be the face of Amazon Fashion in Europe for a season.
The company also bought “The Fashion Fund” unscripted series from Condé Nast Entertainment to air on its Prime streaming service and connected entertainment with shopping through instantly shoppable collections from the show on its site. Jonathan Simkhai, one of the designers in the 2015 CFDA/Vogue Fashion Fund contest, said, “It’s been a tremendous response; our sales have increased in a significant way. It feels like a moment for all of us.”
The moment might ultimately be Amazon’s.
The $107 billion company is a growing and global force in shipping, video streaming and Web services and is using all of that expertise to build an unusual fashion business. It’s all coming together just as shoppers grow more comfortable buying online.
If Amazon truly connects with the fashion customer, it will be a case of the company making its own luck, using its disparate businesses to position itself for market share gains.
For now, the company is connecting its various efforts wherever it can and feeling its way forward.
The first “Style Code” show featured the Morf shirt from designer Tamara Salem, which is reversible in the extreme and can contort itself into 24 styles and sells for $49; Vince Camuto’s Aleni Minaudiere Evening Bag, for $98.99; Essie nail polish for $8.50, and more.
The sizes and height of all the models were given to help shoppers gauge the look.
The premiere of “Style Code” also featured a segment with “Orange Is the New Black”’s Laura Pepron and tips from YouTube Beauty expert Deepica Mutyala. Singer Meghan Trainor was scheduled for the show’s second outing.
Amazon is pushing for a very interactive experience and the show’s hosts were engaging with viewers on a live-chat feature.
“The chat was very lively with lots of positive feedback and useful comments about the topics being discussed,” an Amazon spokeswoman said Wednesday. “Our customers love fashion and have wanted a place to keep up with trends, get insider style tips, and discover new products and brands. We created ‘Style Code Live’ for them, and the community aspect is a huge part of it. We want our audience to be really involved – being live gives us that opportunity; it’s fun and our viewers have a lot to contribute to the show.”
While many of Amazon’s new offerings reside behind the Prime membership wall — where shoppers pay an annual fee to get free two-day shipping and other perks — the new style show is free to all, indicating an effort to bring in more shoppers.
“Style Code Live,” while still in its infancy, is something of a direct assault on QVC and HSN.
“It’s very difficult to come up with any argument that says if Amazon is approaching you, that’s good for you,” said Scott Tuhy, a debt analyst at Moody’s Investors Service who covers QVC. “It’s a large number of people in the Amazon eco-system. A lot of what they’re doing is deepening and broadening the relationship with that core customer. It’s certainly something I would keep an eye on.”
But he said $8.7 billion QVC can effectively compete.
“QVC has a very strong brand,” Tuhy said. “They have very strong relationships. So much of the product that’s on QVC is exclusive. Their audience knows that, ‘This is where I’m going to find some of these brands.’ And I think a lot of these relationships are difficult for any new entrants [to develop].”
But Amazon, which touts itself as seeking to be the world’s most customer-centric company, isn’t sitting still.
The company’s spokeswoman noted, “It’s our first daily live show, it’s our first time with this interactive viewer experience, so we’ll continue to iterate on it.”