So, is this a smart move by Calvin Klein, or could it actually damage the brand’s relationships with traditional retail stores, and even alienate consumers?
Here’s more on the story, and why brands are increasingly looking to Amazon to further growth.
The department store of the future
It’s obvious why brands like Calvin Klein are prioritising Amazon over traditional department stores. In July, Time reported that there had already been 5,300 retail closures in the US, with over 8,000 stores in total predicted to close by the end of this year.
In contrast, Amazon reported a 34% increase in revenue in Q3 to reach $43.7bn. From this, it’s clear that consumers are turning their backs on traditional department stores, and unsurprisingly, choosing Amazon as their first port of call online.
In this sense, Calvin Klein is merely just mirroring consumer behaviour by heading where its target market is already shopping. It might sound contradictory then that part of the Amazon deal is a physical presence, but the difference here is the kind of shopping experience it offers – and it’s far removed from that of the traditional department store.
Each store is kitted out with technology, including Alexa devices in fitting rooms to allow shoppers to ask questions about garments, play music, and control lighting. Meanwhile, customisation stations allow shoppers to personalise their products as well as create content to share online.
Calvin Klein is hoping to capitalise on this level of innovation, engaging customers and increasing brand awareness at a crucial time of year. The combined brand power has also helped to draw in influencer interest, with supermodel Karlie Kloss and YouTuber Lily Singh being enlisted to front the campaign and appear at special store events.
Major impact: @IISuperwomanII has affected millions with her #GirlLove movement. Seen here, behind the scenes on set of her shoot for CALVIN KLEIN X @AmazonFashion. #MYCALVINS pic.twitter.com/q4bAhXCnJt
— Calvin Klein (@CalvinKlein) November 25, 2017
Could it damage relationships?
Despite the growing demand for a personalised and customer-centric shopping experiences, this does not mean that all consumers are interested in Amazon’s technology-driven world. According to research by Cowen, just 18% of customers prefer to shop for clothing on Amazon compared to 40% who prefer physical department stores.
While the pop-up aspect negates this slightly, regular Calvin Klein shoppers could still be put off by only being able to buy through the brand, and this could be further heightened by the limited purchase options in its pop up stores.
For instance, there are no price-tags on items, and instead customers are required to scan a barcode via the Amazon app, which will then display the (changeable) price as it currently is on the Amazon store. While features like this might be fun and convenient for devoted Amazon customers (and reassure them of a low price), they’re likely to be frustrating for regular shoppers, as well as potentially damaging to footfall.
Elsewhere, it’s been suggested that prioritising Amazon could damage Calvin Klein’s relationships with other third-party retailers. This could potentially happen, but then again if the partnership generates success for both parties, the only ones losing out will once again be the department stores. Consequently, it could force many to reconsidering their own customer experience strategies in order to compete.
What’s in it for Amazon?
While the benefits for Calvin Klein include increased reach and marketing opportunities, Amazon has its own agenda. The retailer has been making its fashion ambitions clear of late, launching its new ‘Prime Wardrobe’ service to let customers try on clothing before they buy it.
Meanwhile, it has introduced seven new private-label clothing brands – a step that’s predicted to increase the retailer’s share of the US apparel market.
By partnering with such an established and respected brand like Calvin Klein, Amazon appears to be veering away from its previous identity as an open marketplace into more of a serious fashion contender – one that consumers actively look to for clothing and apparel.
The exclusive aspect of the partnership is also a clever marketing opportunity for Amazon. Giving consumers even more of a reason to shop with the brand, it is likely to increase excitement in the run up to Christmas, and again make consumers aware of Amazon as a fashion retailer.
Calvin Klein isn’t the only big name brand to jump on board. Earlier this year, Nike began selling its items on Amazon, finally relinquishing control over how its products are sold online for the opportunity to increase ecommerce sales. With Amazon capturing over half of all transactions on Black Friday in the US this year – it’s no surprise that even the biggest brands want a slice of the pie.
So, will Calvin Klein’s decision to partner with Amazon result in success? Despite the possibility that the venture could turn off traditional shoppers, the benefits look set to outweigh this.
The pop up stores offer consumers a fresh, innovative, and engaging way to shop. Meanwhile, with Amazon reaping the rewards of an exclusive brand deal at Christmas, and increasing awareness of its own fashion lines – it could spell a change in how fashion brands work with the ecommerce giant in future.
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