Amazon Launches New 'Try Before You Buy' Prime Wardrobe Service
This story originally appeared on Fortune.com.
In a new threat to the likes of Macy’s and Gap Inc, Amazon.com on Tuesday announced it has begun testing a new subscription service called Prime Wardrobe that lets customers try on clothes before they buy them and return them for free.
Amazon’s Prime Wardrobe will be available to Prime members at no extra charge and gives customers one week to decide whether they like what they ordered. They pay only for what they choose to keep, a service similar to those offered by Trunk Club (owned by Nordstrom) and Stitch Fix.
Amazon is set this year to eclipse Macy’s as the top fashion retailer in the United States and as arch-rival Walmart makes a bigger push into apparel e-commerce with recent acquisitions of web-first chains like Bonobos, ModCloth and Moosejaw. Wall Street firm Cowen & Co has projected that Amazon’s share of the U.S. clothing market, currently 6.6%, will rise to 16.2% by 2021.
Amazon Prime Wardrobe, which is currently in beta mode but accepting signups for notification when it launches, has customers pick a minimum of three clothing items or accessories like shoes or watches (and maximum of 15) from over one million available on Amazon Fashion. It is offering brands beyond its own house brands to include names such as Calvin Klein, Levi’s, Adidas, Timex, and higher end brands like Theory, Hugo Boss and J Brand jeans. If a customer keeps five or more items in a Prime Wardrobe order, he or she will get 20% off those items. That discount falls to 10% when a shoppers keeps three or four items.
The service will be part of all Prime members’ memberships, Amazon said. One rationale for the service could be to entice shoppers reluctant to take a chance on Amazon’s house brands, all relatively new. Amazon has invested heavily to improve its private labels like Lark & Ro to compete with national brands.
The latest salvo by Amazon threatens to further weaken department stores’ hold on the apparel market. Macy’s, Kohl’s and J.C. Penney are all facing declining sales as fewer shoppers go to their stores and each gets more than 50% of sales from clothing. Penney, for one, has made it clear it wants to rely less on selling clothes.
The risk free aspect of Prime Wardrobe could attract shoppers unwilling to go to stores (though they might still have to get to a UPS location) and drawn by the ‘try before you buy’ aspect of this form of online shopping.
What’s more, some 80 million Americans are Prime members, according to data released in April by research firm Consumer Intelligence Research Partners, a 38% jump from a year earlier. For $99 annually, Amazon Prime members can access and stream digital movies, TV shows, podcasts, and Amazon’s original productions in addition to getting free two-day shipping and one-hour delivery on certain orders.