Two of Amazon’s hottest categories hit $8 billion in sales in 2017
Amazon is well on its way to becoming the largest clothing seller in America.
In its quest to become a $200 billion company, Amazon knew it had to learn how to sell clothing. The e-retailer’s efforts are paying off as its apparel and shoes product groups exceeded $8 billion in sales from first-party and third-party sellers in 2017, according to “Apparel & Shoes: Amazon 2017 Review,” a report from One Click Retail.
At an estimated revenue of $5.5 billion in 2017 – 25% more than 2016 – apparel is one of Amazon's strongest product groups. Despite strong sales, the e-retailer’s market penetration in apparel is still low. However, this gives Amazon “a major opportunity for growth,” according to the study.
According to the data, a majority of the apparel purchased on Amazon is focused on basic, affordable commodities, such as t-shirts, jeans and underwear. There is less penetration in premium and luxury fashion.
The largest consumer group is men's apparel, which suggests that men tend to take a more utilitarian approach to clothes-shopping, and are less interested in browsing. The category is also both significantly larger and growing at a faster rate than women's, suggesting that women still prefer to do their shopping in stores.
As more of Amazon's core audience – millennials – have children, the e-retailer is experiencing a major increase in sales of related products, including kids apparel. The bulk of sales in this group are made up of babies’ jumpsuits and toddlers' underwear.
Another key growth opportunity — for Amazon and its sellers — is to offer items that may be hard to find in store. The top women's apparel item in 2017 was a tailored full-figure bra by Lilyette, a brand that has had success by offering an infinite shelf of size and style variations. This gives shoppers a level of personalization they're not likely to find in a brick-and-mortar store, the report explained.
The shoe category is also becoming a force to be reckoned with. With $3.7 billion in sales, the shoes product group still has a lot of room for growth. In 2017, Amazon invested heavily in this area with the release of a new private shoe line, The Fix, and by securing a deal with Nike to begin selling on Amazon. However, Amazon's growth in this area is significantly slower than in apparel.
One factor that could be impacting both segments is that costumers still want to try things on. That said, it’s no surprise the top shoe of 2017 was a women's sandal — essentially a one-size-fits-all item. However, Amazon is having a great deal of success in athletic shoes, with Adidas and ASICS securing top items in men's and kids, respectively. Athletic shoes remain the top category, though both the comfort and juniors segments are growing at a much faster rate, the study reported.
One factor that is driving growth across both categories however, is Amazon’s commitment to private label. In addition to The Fix, the company also has a myriad of clothing lines offering a range of items from basics to designer-influenced women's lines. Late last year, Amazon also moved into the competitive activewear category with three new sports apparel brands: Goodsport, Peak Velocity, and Rebel Canyon.
“Investing in private brands in apparel and shoes is a smart move for Amazon since these products have relatively high margins compared to other major groups such as food or consumer electronics,” said Nathan Rigby, VP sales and marketing at One Click Retail.
Though apparel and shoes are both healthy categories on Amazon, “the potential for further market penetration is great,” he continued.
“For brands, the biggest opportunities come from leveraging Amazon's infinite shelf to offer sizes and variants that are hard to find in stores, competing in the growing athleisure space, and offering premium and luxury product lines … at a time when there is little competition,” Rigby added. “Amazon is likely to become the largest clothing seller in the U.S. by the end of 2018, so now is the time for apparel and shoes brands to invest in their Amazon strategy.”
In its quest to become a $200 billion company, Amazon knew it had to learn how to sell clothing. The e-retailer’s efforts are paying off as its apparel and shoes product groups exceeded $8 billion in sales from first-party and third-party sellers in 2017, according to “Apparel & Shoes: Amazon 2017 Review,” a report from One Click Retail.
At an estimated revenue of $5.5 billion in 2017 – 25% more than 2016 – apparel is one of Amazon's strongest product groups. Despite strong sales, the e-retailer’s market penetration in apparel is still low. However, this gives Amazon “a major opportunity for growth,” according to the study.
According to the data, a majority of the apparel purchased on Amazon is focused on basic, affordable commodities, such as t-shirts, jeans and underwear. There is less penetration in premium and luxury fashion.
The largest consumer group is men's apparel, which suggests that men tend to take a more utilitarian approach to clothes-shopping, and are less interested in browsing. The category is also both significantly larger and growing at a faster rate than women's, suggesting that women still prefer to do their shopping in stores.
As more of Amazon's core audience – millennials – have children, the e-retailer is experiencing a major increase in sales of related products, including kids apparel. The bulk of sales in this group are made up of babies’ jumpsuits and toddlers' underwear.
Another key growth opportunity — for Amazon and its sellers — is to offer items that may be hard to find in store. The top women's apparel item in 2017 was a tailored full-figure bra by Lilyette, a brand that has had success by offering an infinite shelf of size and style variations. This gives shoppers a level of personalization they're not likely to find in a brick-and-mortar store, the report explained.
The shoe category is also becoming a force to be reckoned with. With $3.7 billion in sales, the shoes product group still has a lot of room for growth. In 2017, Amazon invested heavily in this area with the release of a new private shoe line, The Fix, and by securing a deal with Nike to begin selling on Amazon. However, Amazon's growth in this area is significantly slower than in apparel.
One factor that could be impacting both segments is that costumers still want to try things on. That said, it’s no surprise the top shoe of 2017 was a women's sandal — essentially a one-size-fits-all item. However, Amazon is having a great deal of success in athletic shoes, with Adidas and ASICS securing top items in men's and kids, respectively. Athletic shoes remain the top category, though both the comfort and juniors segments are growing at a much faster rate, the study reported.
One factor that is driving growth across both categories however, is Amazon’s commitment to private label. In addition to The Fix, the company also has a myriad of clothing lines offering a range of items from basics to designer-influenced women's lines. Late last year, Amazon also moved into the competitive activewear category with three new sports apparel brands: Goodsport, Peak Velocity, and Rebel Canyon.
“Investing in private brands in apparel and shoes is a smart move for Amazon since these products have relatively high margins compared to other major groups such as food or consumer electronics,” said Nathan Rigby, VP sales and marketing at One Click Retail.
Though apparel and shoes are both healthy categories on Amazon, “the potential for further market penetration is great,” he continued.
“For brands, the biggest opportunities come from leveraging Amazon's infinite shelf to offer sizes and variants that are hard to find in stores, competing in the growing athleisure space, and offering premium and luxury product lines … at a time when there is little competition,” Rigby added. “Amazon is likely to become the largest clothing seller in the U.S. by the end of 2018, so now is the time for apparel and shoes brands to invest in their Amazon strategy.”