Amazon Apparel: 2 Consumer Segments Can Drive Up Amazon’s Fashion Sales
Amazon.com's ongoing venture into the fashion category is one of the hottest topics in retail right now. The company’s expanding fashion offering is fascinating commentators, terrifying rivals and, as our latest research shows, attracting a very large number of shoppers. We recently conducted an in-depth survey of internet-using U.S. consumers on this subject, and the results confirm that Amazon is strong in clothing and footwear.
Our survey, for example, found that almost half of all U.S. apparel consumers polled have bought clothing or footwear on Amazon in the past year, putting the retail giant neck and neck with Target as the second-most-shopped retailer for apparel in the U.S. Our research also uncovered two springboards to further growth for Amazon Fashion: attracting a larger number of younger shoppers, and driving up Prime membership rates even further.
Younger Shoppers Are Interested in New Services From Amazon, But Are Underrepresented Among Amazon Apparel Shoppers
Amazon has long been perceived as a retailer of hardline goods that are bought on specification — products such as electronics, media and toys. So, how are consumers viewing Amazon’s push into fashion? To gain insight into that question, we asked shoppers for their views on Amazon as an apparel retailer. Our survey revealed that younger shoppers are the most enthusiastic about taking part in the full Amazon Fashion experience. Amazon apparel shoppers ages 18 to 29 were significantly more likely than older age groups to agree with the following opinions:
- They would like to see more clothing and footwear brands on Amazon.
- They are interested in trying Amazon Prime Wardrobe, a service that allows customers to try on clothing at home before paying for items they choose to keep.
- They are interested in trying Amazon’s private-label apparel products.
- They would like Amazon to open physical fashion stores.
It may be tempting to conclude that younger consumers enthusiasm for these additional offerings simply reflects a greater tendency to shop for fashion on Amazon. However, our survey findings didn't bear that out. In fact, compared with respondents in all other age groups, those ages 18 to 29 were the least likely to say that Amazon is among their favorite retailers for clothing and footwear. Moreover, those in the 30 to 44 and 45 to 60 age groups were more likely than younger shoppers to say that they had bought apparel on Amazon in the past year.
Amazon hasn't yet won over younger apparel shoppers in the way it has those in their 30s, 40s and 50s. However, given young shoppers interest in added options such as Prime Wardrobe and private label, Amazon stands a good chance of boosting its customer numbers in this age group as it builds out its brand and service offerings in fashion.
Prime Members Drive Amazon Apparel Sales
Amazon’s second plank for further growth in fashion and apparel will come in driving up its Prime membership rates, as Amazon Fashion’s high overall shopper numbers largely consist of Prime members. Almost two-thirds of Prime members surveyed said that they had bought apparel on Amazon, but the same metric was just 21.5 percent among those without access to Prime. Similarly, Amazon is the most-shopped retailer for clothing and footwear among Prime members, but only the seventh-most-shopped retailer among those without Prime membership. Based on our survey results, we estimate that Prime members account for more than 60 percent of all Amazon apparel customers.
We can only conclude that as Amazon continues to recruit more Prime members, it will strengthen its ability to carve out market share in fashion. Our survey found that 43 percent of internet-using U.S. consumers already have a personal Prime membership, and that a further 21 percent have access to Prime benefits through someone else in their household. This leaves just 36 percent of consumers without any access to Prime. These figures suggest that Prime membership rates could plateau in the medium term. If that happens, Amazon will have to depend on more traditional growth levers, such as driving up average basket value and frequency of shopping, in order to continue building share in apparel.
Deborah Weinswig is the founder and CEO of Coresight Research (formerly Fung Global Retail & Technology), a retail think tank.