It is a physical clothing store. Like, you know, a real brick-and-mortar room where you try things, buy them and take them home. An IRL store. Google it if you’ve never been to one.
Amazon (AMZN) announced on Thursday that they will open Amazon Style, their first clothing, shoe and accessories store later this year at a great shopping complex in Los Angeles. Neighbors of the 30,000-square-foot store will be some of the traditional clothing and department stores Amazon has been pushing for the past decade – Nordstrøm (JWN), Urban Outfitters (URBN), J. Crew, H&M and others. There̵[ads1]7;s a JCPenney across the street, one of the most prominent victims of the transformation of American retail spurred on by Amazon.
It may seem surprising that Amazon, which has grown to become the largest clothing retailer in America since it began selling clothing in 2002, wants to open a physical store. But in-store purchases still account for more than 85% of retail sales in the United States, and shoppers often want to see how the clothes look, feel and fit before they buy. It can also be more difficult to find new clothing brands and styles when you surf the web than in person.
“Customers like to shop online and in-store. And it’s no different in fashion,” said Simoina Vasen, CEO of Amazon Style, in an interview. “There are so many great brands and designers, but it’s not always easy to spot them.”
There are some news to Amazon Style and ways the company hopes will make shopping faster and more personal for customers. However, many of the ideas Amazon uses in the store are not new to retail.
Most of the clothes will be stored at the back of the store, and only one sample of each item will appear on the sales floor. To purchase it, customers will scan a QR code using a mobile Amazon shopping app and then retrieve it at the pickup counter. If they want to try it first, they can have it sent to a rehearsal room, which has touch screens where customers can request different sizes or colors. When customers browse the store and scan items, Amazon’s algorithms will recommend other items they may be interested in purchasing.
Vasen said that the store is a “truly unique experience”, but similar technology can be found at other retailers. On Nike (OF) flagship stores, such as Nike app members, scan codes on sneakers and clothing, and these items are shipped directly to a rehearsal room. The Reformation clothing brand only shows one of each item in its showrooms, and what customers want to try is delivered straight to wardrobes that have different lighting options. American eagle (AEO) and others have tested interactive rehearsal rooms, where shoppers can request different sizes and styles on a tablet placed in the room.
Amazon Style will offer a mix of hundreds of well-known brands (Vasen did not specify which) and its own private label brands. Retail analysts have said that a physical presence in clothing could help Amazon reach customers who want to shop in person and also drive the growth of Amazon’s more profitable – but lesser known – private labels.
Other benefits of a physical store: Customers can also deliver Amazon returns in the store, or order online and pick them up there.
Amazon has been working on this clothing initiative for years, said Vasen, who has helped expand Amazon’s physical store presence and also led Amazon’s Prime Now grocery delivery service. She did not say when the first Amazon Style store will open this year or how many Amazon plans to add in the future.
Amazon Style will be the company’s latest attempt to enter physical retail, an area it has struggled to crack.
In 2015, Amazon opened its first physical store, Amazon Books, in Seattle. Two years later, Amazon Whole Foods bought its 471 stores for $ 13.7 billion. The company also has dozens of 4-star stores, where it sells its highest-ranked items, and Amazon Go boxless convenience stores. It is building a new, separate line of grocery stores, called Amazon Fresh, to chase a buyer in the middle market, different from Whole Foods’ advanced customer base.
As of December 31, 2020, Amazon had 611 physical stores in North America, including Whole Foods, according to its latest annual filing.
Amazon has not had the same success with physical stores as online. Sales in Amazon’s physical stores fell 0.18% in 2019 from the previous year to $ 17.2 billion and 5.6% in 2020 as more buyers ordered online in the pandemic.
During the last results of the nine months ended September 30, Amazon’s sales in physical stores rose by 1.5% from the same stretch the year before.
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