Amazon (AMZN - Free Report) has made its Prime Wardrobe, offering “try before you buy” facility, available to the customers. This move is in sync with the company’s strategy to bolster presence in the retail market.
The company rolled out Prime Wardrobe in the middle of the last year. However, it was in beta phase up till now and available through invitations only. Now it is available to the U.S. Prime members.
Amazon intends to enrich customer experience through this move. This will enable the customers to place the order online from separate section of Prime Wardrobe on its site. Following the placement of order, customers will get the wardrobe box delivered. Then they can try their choices before finally buying them.
The company will be able to attract more customers to its e-commerce platform with the introduction of such shopper friendly features. Consequently, this will drive the top line..
Coming to the price performance, shares of Amazon have returned 49.6% on a year-to-date basis, outperforming the industry’s rally of 30%.
Prime Gaining Traction
Amazon’s strong focus toward enhancing Prime service with the help of exciting discounts, expanding free two-hour delivery facilities, growing movies, audio and video portfolio and now the Prime Wardrobe bodes well.
The shoppers of Prime Wardrobe will get a huge collection of clothes, shoes and accessories of numerous brands. Notably, it will encompass men, women and kids.
Home brands like Core 10, Daily Ritual, Peak Velocity, Buttoned Down, Lark & Ro and many more will be available. Further, shoppers can choose from national brands such as Levi’s, PAIGE, Calvin Klein, A|X Armani Exchange, Adidas, Puma, Native to name a few.
Moreover, the company is easing the process by giving customers a timespan of seven days to make their selections and the ones to return. Notably, the customers will pay for only the ones they keep.
We believe the adoption rate of Prime will get a boost as Prime Wardrobe thrives to simulate a shopping experience similar to brick & mortar fashion retail store at the customers’ home. Recently, the number of paid Prime members exceeded 100 million.
Moreover, the latest move of the company will aid in reinforcing footprint in the fashion retail industry.
Fashion Retail Holds Promise
Per the recent data from Statista, the fashion e-commerce market in U.S is expected to generate revenues of $103 billion in 2018.
Further, it is anticipated to grow at a CAGR of 7.5% between 2018 and 2022 and to reach $137.8 billion by 2022. The apparel segment remains the key growth driver.
Vast portfolio of apparels and other fashion items, Prime Wardrobe and other benefits of Prime will continue aid the company’s growth in the fashion market.
Amazon’s vast and efficient e-commerce platform has already overwhelmed the brick & mortar stores in the retail sector.
The latest move of Amazon is likely to intensify competition further. In fact, fashion retailers like Nordstrom (JWN - Free Report) , Stitch Fix (SFIX - Free Report) , Buckle (BKE - Free Report) to name a few, witnessed share price decline following the announcement of Prime Wardrobe last year.
Further, Prime which is a subscription-based service will help Amazon to strengthen competitive position against Nordstrom owned Trunk Club, Stitch Fix and Le Tote.
Moreover, the company has gained a competitive advantage against Stitch Fix which offers a shopping service similar to Prime Wardrobe.
Nevertheless, Amazon seems to be more customer-friendly as it allows the customers to select the items unlike Stitch Fix which makes the collection for its customers.
Consequently, Amazon will be able to grab significant portion of U.S. fashion market with all the above mentioned Prime benefits and other endeavors.
Currently, Amazon flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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