As Amazon Re-Enters High Fashion, New eChallenges Abound

It’s all the fashion these days to battle it out online for more market share when it comes to selling clothes to consumers.

Excuse the bad pun, but the fashion game looks ready to gain new energy this year, thanks to recent news involving Amazon. Just in case you haven’t heard yet, Amazon is planning to launch a luxury fashion platform in the first half of this year, according to reports.

This isn’t Amazon’s first attempt at breaking into the luxury fashion market – the retail giant originally tried in 2012, but was not successful.

Part of the problem is the eCommerce brand’s image. Amazon struggles to sell high-end items alongside rote objects like discount flashlights and bookshelves. This sort of placement has kept many luxury fashion brands away, even though Amazon has promised to not discount their items.

The new platform will work similarly to the concession model in department and specialty stores, where a brand will run a mini-shop inside a store. Amazon’s new platform will give brands complete control over the look and feel of their online spaces and which products they sell. Participating brands will also have access to Amazon’s thorough and storied logistics network, which aids in speedy delivery and provides customer service.

Fashion Rentals

Amazon will face new and different competition from the first time the eCommerce operator tried upscale fashion. Part of the reason is changing consumer desires.

Indeed, a decade ago, the concept of building a retail operation around shopping in other people’s closets was something of a hard sell. In 2009, the sharing economy was in its earliest days – Uber had just been founded, Airbnb was less than a year old and the conversation about how to make anything and everything shareable (instead of owned) had not quite begun.

It was in that emerging environment 10 years ago that Rent the Runway launched, with a rather novel sales pitch: Why buy high-end clothing items that will be worn once or twice before languishing in one’s closet, when one can find them on Rent the Runway’s market, rent them temporarily as needed and then send them back to their owners?

“We were kind of the original disruption in the fashion retail space, as it brought the concept of sharing a closet to the forefront in 2009. From there, we built this service as a utility [that] our customers can rely on, and as a new dynamic model for clothing,” Rent the Runway COO Anushka Salinas told PYMNTS in a recent conversation.

It would be underselling it to say that the concept ignited from there. As it turned out, subscribing to short-term clothing ownership was a highly appealing prospect. Ten years later, Rent the Runway has grown quite a bit from a small subscription service trying to sell consumers on the concept of renting out their special occasion dresses. The company has added a subscription service with 100,000 members, on top of the 10 million or so shoppers who use the site à la carte. It has expanded its closet offering to include work clothes, casual wear and, just this year, both kids’ clothes and skiwear.

P2P Angle

That’s hardly the only change taking place. New technology is also enabling more fashion entrants and companies to claim their place in the market.

For instance, Wardrobe, a peer-to-peer (P2P) fashion marketplace that gives users the chance to rent out designer and vintage items for a fraction of their purchase price, has recently debuted amid many competitors with similar concepts. The company brings two new ideas to the table: replacing warehouses with dry cleaners and making it easy for influencers’ closets to be duplicated.

According to Founder Adarsh Alphons, the average woman owns 57 pieces of clothing that they wear less than once a year, but are hesitant to throw out or resell them because they are vintage or designer pieces that they still want to wear on occasion.

Wardrobe recently launched from its public beta, powered by a $1.5 million seed round, as the latest entrant hoping to capture the secondhand luxury market. In some sense, the company is late to the race, facing a host of long-established competitors. But Founder Adarsh Alphons believes the firm is lean and ready to compete with two critical innovations that are unique among fashion platforms in the sharing economy.

The first is mostly a logistical improvement: Wardrobe uses dry cleaners as their product hubs. The second is an upgrade to how shoppers search the site; users can browse for products in the traditional way, but they can also follow certain sellers on the site and monitor the changing content of their closets.

None of this is meant to suggest that one should bet against Amazon when it comes to high-end fashion – after all, the company tends to succeed more often than it fails. But much has changed since the last time Amazon did upscale fashion, and that landscape keeps evolving.