Amazon opens an innovative clothing store in Los Angeles
Amazon (AMZN) today announced the opening this year of its first Amazon Style clothing store in the suburbs of Los Angeles. Amazon technologies will help reduce queues in the fitting room, riots in the sales halls, and pick up clothes. As a result, Walmart, Macy’s, Kohl’s, and Nordstrom’s are declining.
Being the world’s largest online retailer, Amazon has been experimenting with physical store formats for a long time, introducing supermarket technologies without cash registers and payment via biometric palm scanners.
The news about the launch of an innovative Amazon Style clothing store, which to a wide range of audiences, is attractive in terms of new sales;
Format and potential leadership in the clothing market, rather than a significant profit shortly.
The business of physical stores Whole Foods, Amazon Go, and other stores from Amazon brought in the 3rd quarter (ended September 30, 2021) to just $4.27 billion. (an increase of 13% compared to last year’s value) out of total quarterly revenues of $110.8 billion. Quarterly revenue and profit statistics on the Amazon Reports page.
More interesting from investors’ perspective is the potential for sales of licenses for new technologies introduced by the most advanced retailer in the world. The company announced that it was negotiating the deal of its Amazon One technology, payment using palm scanning, with other companies.
Amazon shares, which have declined by 12.8% six months, fell by 1.65% on Wednesday but rose by 0.9% during trading (at the time of writing) in the background of today’s news. Trading signals and forecasts for Amazon stocks. Shares of Walmart (WMT), which Amazon surpasses in terms of retail sales, on the contrary, declined slightly, as did shares of other major clothing retailers: Macy’s (M), Kohl’s (KSS), and Nordstrom (JWN).
With a retail area of just over 9 thousand square meters, the Amazon Style store will feature women’s and men’s clothing, shoes, and accessories from well-known and new brands at prices designed for a wide range of buyers.
Only “showcase” copies of goods will be presented in the store, while buyers will choose the desired color and size through the application by scanning the QR code on the product. Then, the staff will bring the selected items to the fitting room or directly to the delivery counter.
Buyers can click a button in the Amazon app to add the product to the fitting room or send it to the pick-up counter. Then, with the help of displays in the correct rooms, customers can continue to make purchases, requesting the desired color or size without leaving the fitting room. In addition, the algorithms of the Amazon technology system will offer recommendations for investments.
Shoppers will use the Amazon One system to pay during checkout and purchases in the Amazon Style store the purchase history in the Amazon app. But, unlike Whole Foods stores, according to Vasen, Style stores will not offer any special discounts for Prime subscribers.
The store concept is likely to increase the burden on already struggling traditional clothing retailers, especially department stores, which are struggling to adapt to the shift of shoppers to online shopping, which accelerated during the pandemic.
Wells Fargo (WFC) predicted in a March 2021 report that Amazon’s clothing and footwear sales in the United States will grow by about 15% in 2020 and exceed $41 billion. 20-25% higher than Wal Mart 11% to 12% of all clothing sold in the United States and 34% to 35% of all clothing sold online.
