Amazon Acquisition of Shopbop Bodes Well for Apparel Retailers
Amazon.com’s recent acquisition of Shopbop.com further acknowledges the importance of apparel as a primary online retail category. The deal is also indicative of Amazon’s growing importance as a portal for several well-known stores, labels and brands.
Terms of the deal were not disclosed.
Shopbop.com, a Madison, Wis.–based site specializing in designer clothing and accessories, retails product from more than 75 fashionable labels, including Marc Jacobs, Juicy Couture, Seven for All Mankind, True Religion and Ya-Ya.
Shopbop CEO Bob Lamey said that Amazon’s “support, experience and resources [would] take the Shopbop brand and business to new levels.” Amazon said it would boost Shopbop’s audience base by exposing it to the millions of shoppers who visit Amazon’s main site each month.
The companies said that for the time being Amazon would operate Shopbop, founded in 1999 as a local bricks-and-mortar store, under the Shopbop brand and keep the sumptuously designed Web interface in place as a complement to the Amazon apparel and accessories store.
With Amazon now a primary e-commerce technology provider, hundreds of other retailers— most recently, Target Corp.—routinely subscribe to Amazon as their online retail software platform provider. Amazon has made it remarkably easy for any retailer to open and maintain a popular Amazon zShop as a pure-play or adjunct to existing bricksand- mortar stores. There are currently more than 31,000 items of women’s apparel for sale in several hundred zShops.
The Amazon purchase comes on the heels of the record-breaking 2005 Holiday season, when apparel solidified its position as the top online category, shattering many conventional beliefs that consumers would never buy clothes online in large quantities because they are unable to try them on, feel the fabric or assess the quality of workmanship firsthand.
Clothing reached the top sales category last Holiday with $5.3 billion in purchases, more than 42 percent above 2004 levels, placing apparel among the fastest-growing categories, according to Nielsen/NetRatings. Heather Dougherty, senior retail analyst at Nielsen/NetRatings, said that “apparel [being] one of the more dominant product categories shows that consumers have a high comfort level with buying online.”
Results of the Nielsen/NetRatings study also revealed that younger buyers, a muchsought- after demographic, are especially comfortable and enthusiastic about making clothing purchases on the Web.
“Consumers often buy online brands they see offline and have come to trust that they won’t be stuck with e-commerce purchases that don’t fit right,” Dougherty said. “They know the brands they are going to find and they know that they will usually be able to return items if they need to. In a sense, online retail now looks more like traditional retail, where apparel has long been a mainstay throughout the year and especially during the holidays.”
Additionally noteworthy about Amazon’s acquisition is that the company has rarely engaged in U.S.–based takeovers, instead keeping to third-party partnerships, or so-called strategic alliances. For direct acquisitions, it has favored overseas entities such as the U.K.–based Internet Movie Database Ltd. and China’s Joico, as well as a host of smaller Internet retailers in Western Europe.
Site review: no sweat
An elegant and informative Web site emanates from Santa Monica, Calif., at www.sweater.com.
“Look Books” is a unique fashion gallery that offers many of the site’s best offerings in a virtual-magazine format that has users pointing their mouse and turning pages in an unusually literal—though animated—way. It takes a little getting used to, but it’s quite nifty once you get the hang of it.
Founded in 1999 by Bruce Gifford, who has partnered with Dan Jaffe, the site is augmenting its “One Girl Whohellip;” shop of sweaters that launched in 2003 with other offerings.
“I don’t want Sweater.com to be disguised as the ’One Girl Whohellip;’ shop,” Gifford said. “We aim to be the sweater store, and we’ll have a complete collection of knitwear in all categories.”
Additional brands, including tees, are expected to be introduced in the next few months in an effort to fulfill the company’s goal of being truly unlimited in terms of selection.
Sales projections are $20 million in wholesale volume for the year ahead.
With free ground/standard shipping on most orders, a great product presentation, and a very pleasant and easy-to-use shopping cart, Sweater.com appears to be well on its way.
