Amazon is making a foray into the luxury shopping segment with the rollout of its new exclusive Luxury Stores app in a move to attract more shoppers.
Amazon’s (AMZN) Luxury Stores will offer established and emerging luxury fashion and beauty brands. The e-commerce giant said that the new luxury fashion store will be available in the Amazon app by invitation only to US Prime members. It will launch with iconic American fashion house, Oscar de la Renta, featuring the retailer’s pre-fall and fall/winter 2020 collections, inclusive of ready-to-wear, handbags, jewelry, accessories, and a new perfume, with childrenswear coming soon.
The launch comes as Amazon is seeing more customers turning to mobile shopping. In the past year, Amazon customers ordered more than 1 billion fashioni items on mobile devices, the e-commerce giant said.
“We are inspired by feedback from Prime members who want the ability to shop their favorite luxury brands in Amazon’s store,” said Amazon Fashion President Christine Beauchamp. “It’s still Day One, and we look forward to growing Luxury Stores, innovating on behalf of our customers, and opening a new door for designers all over the world to access existing and new luxury customers.”
The collections will be sold directly from the participating brands as a ‘store within a store’ concept, which means that brands independently make decisions regarding their inventory, selection, and pricing. Amazon will offer the merchandising tools for brands to create and personalize content including interactive technology features like “View in 360”, enhanced, auto-play imagery and in-motion graphics.
The e-commerce giant is one of the winning stay-at-home stocks, as the coronavirus pandemic has created opportunities for companies like Amazon who are weathering the crisis relatively well and are looking to increase their reach and boost market share.
Shares in Amazon, which fell less than 1% over the past month, have been on a steady gaining streak jumping a stellar 71% so far this year, with the $3,725.59 average analyst price target implying 18% upside potential is lying ahead in the coming 12 months.
Morgan Stanley analyst Brian Nowak this week reiterated a Buy rating on the stock with a $3,750 price target, as he expects consumer spending to shift to e-commerce during the holiday season.
“We remain keenly focused on the continued shift in consumer spend away from experiences – travel, live events, amusement parks, bars/restaurants – toward e-commerce…as our bottom up analysis shows how there is likely to be ~$30-60bn of monthly “experience spend” up for grabs for the remainder of ’20 even as the world re-opens,” Nowak wrote in a note to investors. “We see these experience dollars shifting toward shopping, further fiscal stimulus (modeled in October), and a socially-distanced holiday shopping season (with less mall shopping and more online shopping) now leading to 43% 2H:20 e-commerce growth (vs 33% previously).”
Overall, AMZN scores 36 Buy ratings from analysts versus 1 Hold rating adding up to Strong Buy consensus. (See Amazon stock analysis on TipRanks).
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