Amazon is making a power move on Nike and other sportswear brands
Amazon.com has contacted Taiwanese vendors that manufacture apparel for Nike, Lululemon Athletica, Under Armour and others about producing small lots of private label athletic wear.
The development, first reported by Bloomberg, would give Amazon a presence in a category that has been hurt by the business failures of large trading partners such as The Sports Authority and led brands such as Nike to increasingly focus on selling directly to consumers online and in stores.
This summer, Nike joined Amazon’s brand registry program, which allowed the brand to sell directly to the e-tailer while maintaining control of its messaging and gaining access to purchasing data. While Nike has had a relationship with Amazon-owned Zappos, it had not previously sold any of its products directly to Amazon.
If Bloomberg’s reporting proves true, it would mark another move by Amazon into apparel. The company currently sells lines of menswear and accessories, women’s clothing and bags, and children’s wear under a variety of private labels. A growing number of analysts, according to The New York Times, have pegged 2017 as the year that Amazon will push past Macy’s to become the largest seller of apparel in the U.S.
Amazon has also used its Alexa digital assistant technology to help bolster the company’s apparel efforts. In April, the e-tailer introduced Echo Look, a voice-activated device that comes with a camera, built-in LED lighting and computer vision-based background blur to help users create their own personal lookbooks, which can be shared with friends and Amazon. The device includes a Style Check app that uses “advanced machine learning algorithms and advice from fashion specialists” to provide feedback to users on their various looks. If a person can’t decide on what to wear, they can submit two photos using Style Check. The app then provides an opinion based on criteria including fit, color, styling and current fashion trends.
Whether Amazon makes a push into athletic apparel or not, just the mention of its intentions is enough to affect potential rivals. Bloomberg’s reporting of Amazon’s plans last week helped drive shares of Lululemon down almost five percent in trading on Friday. Under Armour’s stock declined 2.8 percent. Nike’s share price, which initially declined, recovered to end up 0.3 percent at the end of trading last week.
- Amazon Is Getting Into Sportswear – Bloomberg
- What will a Nike/Amazon deal mean for the brand and other retailers? – RetailWire
- Can Amazon dominate apparel with its own private labels? – RetailWire
- Amid Brick-and-Mortar Travails, a Tipping Point for Amazon in Apparel – The New York Times
- Will Amazon’s Echo Look be a clothes selling machine? – RetailWire
DISCUSSION QUESTIONS: How do you think Amazon is likely to approach the athletic apparel category? How might Amazon’s actions affect its relationship with sportswear brands? Where would this move fit with Amazon’s other ventures in the apparel retailing?