قالب وردپرس درنا توس
Home / Business / & # 39; Brands don't need Amazon. & # 39; Nike's departure can make others go

& # 39; Brands don't need Amazon. & # 39; Nike's departure can make others go



A shopper browsing through Amazon.

Indranil Bhoumik | Mint | Getty Images

Nike breaks up with Amazon.

The sneaker retailer said it will no longer sell goods through the e-commerce giant's website, in an effort to focus on Nike's own business directly to the consumer. The news sets alarm bells in retail, with some speculation that other brands may follow Nike's lead. And some say they would be smart to do it.

"Brands don't need Amazon," said Jefferies analyst Randy Konik. "Amazon had an advantage with the speed of delivery, but that advantage has compressed. With Nike leaving the Amazon platform, it reinforces our view that retailers / brands will not be displaced by Amazon."

brands are aware that traffic driven to their own site (e.g. NIKE.com) is self-sustaining, more profitable and actually brand-enhancing, while Amazon.com traffic and incremental revenue are less profitable but also less brand-enhancing , Konik continued. "We believe many strong clothing (and even non-clothing) brands will continue to avoid or dampen relations with Amazon in the future."

Amazon has tried to become a bigger name in fashion, but many claim the site is still difficult to navigate and especially to discover new brands. It is also often difficult to determine whether goods are sold by third parties or directly from the brands that make them.

In recent years, Amazon has noticed brands including Nike, PVH's Calvin Klein, Chico's, Sears and J. Crew for selling there. It worked with influencers ahead of Prime Day to push fashion deals. It recently started releasing its first holiday catalog focusing on fashion offerings.

But Konik argues, "Amazon is just a traffic aggregate that reduces friction in consumption … it doesn't build communities."

Amazon didn "Not immediately respond to CNBC's request for comment.

" The Amazon threat "has now proven to be exaggerated," Wells Fargo analyst Tom Nikic said in a note. He added that the pressure on Foot Locker, one of Nike's largest wholesale partners that it still relies on, should be "relieved."

Evercore ISI analyst Omar Saad said he wonders if other brands "will follow" Nike's leader.

Nike shares rose about 1

.2% Wednesday morning. Amazon shares were down about 0.5%.

– CNBC's Michael Bloom contributed to this report.


Source link