J. Crew now selling Mercantile label through Amazon

Source: https://www.retaildive.com

Dive Brief:

  • Amazon Fashion on Wednesday announced the launch of a dedicated storefront for J.Crew Mercantile, starting with a curated fall assortment.
  • Mercantile is J. Crew’s value label, and the collection includes field jackets, denim, outerwear and other pieces priced under $300, according to a press release from the companies.
  • Former J. Crew CEO Mickey Drexler last year said that J. Crew once approached Amazon about buying the company, though he also said that he didn’t think it would be wise to sell through the e-commerce giant.

Dive Insight:

Limiting this tie-up to its Mercantile label allows J. Crew some protection from what prevented Drexler from selling through Amazon — his understanding that Amazon may knock off bestsellers and ultimately undermine the brand.

Research from Gartner L2 bears that out, uncovering how diligently Amazon brings out best-sellers using data from brands selling on its site to develop its own versions.

Amazon presents a multi-faceted challenge in particular to apparel brands, which face consequences no matter how they respond. The e-commerce giant in recent years has launched a series of private label clothing and accessories brands in various sub-categories, including footwear and activewear, and is experimenting with various sales and delivery models, including a recently expanded apparel subscription service, Prime Wardrobe.

Drexler isn’t alone in his wariness of Amazon’s potential for copying brands’ bestsellers for its own labels. Two years ago, when Gap Inc. CEO Art Peck told analysts that the struggling apparel retailer should rely on third-party sellers to expand its customer reach and that it would be “delusional” not to consider selling on Amazon, analyst Sucharita Mulpuru deemed the idea “idiotic,” saying that Walmart, Target and Costco would all be better choices.

“There’s no good that will come of it,” she told Retail Dive in an email then. “Target and Costco have less of a reputation for cannibalizing suppliers.”

For Amazon’s part, bringing on Mercantile also keeps the e-retailer’s apparel offering in “value” territory, which has emerged as its biggest draw. A large portion of apparel shoppers head to Amazon for well-priced apparel, according to Coresight Research, to the point where Coresight founder-CEO Deborah Weinswig said earlier this year that Amazon is being perceived as an off-price apparel retailer. Roughly half (48%) of Amazon apparel shoppers said they expect to pay less than full price when buying clothing or footwear on the site, 32% say they go there because Amazon offers the lowest prices and 49% say Amazon offers good value.

Amazon’s apparel offering isn’t much of a high-fashion play so far. More than half (54%) look for casual apparel like jeans and sundresses, and between 25% and 30% of shoppers look for athletic wear, outerwear, loungewear and basics, according to other research this year from CPC Strategy. “The biggest takeaway for retailers is this: If you can’t compete with free shipping or low prices, then you need to have a very unique brand or high-quality product,” according to that report.



Categories: Apparel, Brands, Business, E-commerce, Retail

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