Ebay launches Amazon-style end-to-end fulfilment UK service

Less than a year after the inception of Amazon’s Luxury stores, the company has opened the doors to more consumers and begun using the platform as an opportunity to introduce people to new designers. Amazon recently announced the debut of Chufy, a label launched in 2017 by art director and fashion consultant Sofía Sanchez de Betak, and Mira Mikati’s eponymous brand. Amazon also recently introduced Pietro Simone beauty products.

Amazon launched its Luxury Stores marketplace in September, offering invited US Prime customers early access to Oscar de la Renta’s fall/winter 2020 collection through the Amazon app. Though it is no longer invitation-only, Luxury Stores customers still have access to a reserved customer service hotline and exclusive items from each luxury brand.

Amazon’s foray into luxury is part of “Amazon Fashion Connects,” an effort to build relationships with new and established European designers amid challenges. Initial collaborations included digital storefronts with Mercedes Benz Fashion Week Madrid, the British Fashion Council and German fashion magazine InStyle.

A recent tracker reported that online luxury purchases grew 39 percent worldwide year over year in both April and May of 2020. Online retail sales are anticipated to account for 25 percent of total luxury purchases by 2025, up from 10 percent in 2019.

In addition to the pandemic, a key driver is the reduction of online checkout frictions, which has led to speedier transactions that make it more likely for consumers to embrace shopping internationally. One recent survey found that 68 percent of consumers had made online purchases from international merchants within the past year. One-quarter of consumers bought clothing items from retailers based in other countries, with this share rising to 31 percent for millennials and Generation Z shoppers. And one advantage that Amazon has with its Luxury Stores — which others may struggle with — is free shipping.

Luxury items are also expected to be a hot commodity this holiday season as shoppers shift their focus from “needs” to “wants,” and begin to revamp wardrobes or turn liquidity into goods with value as inflation concerns grow. According to an analysis by Salesforce, handbags and luggage are among the items expected to do well this holiday season, as well as luxury apparel and accessories such as watches.

Tambo's view:

Luxury retailers and have historically kept their brands off of Amazon.A platform built primarily on competitive pricing, Amazon’s model has traditionally been perceived as the home of bargains for lower-end retailers: one that is largely incompatible with the luxury experience. However, in recent times, Amazon has increased its offering by introducing Luxury Stores and more recently, has upgraded the luxury marketplace with glossy ads to make it a more attractive platform for higher end brands. If luxury retailers want a slice of the growing eCommerce market, sprucing up their online stores on marketplaces and freshening up their digital offerings is vital to cashing in on the growing demand.

If you are a luxury brand and want to sell on Amazon but have not yet done so, get in touch with us and we can help you get started on the platform.