Cotton On planning to take on Amazon
CO-OPERATE or compete? It’s a question weighing on local retailers after Amazon rolled out its full offering to Australian shoppers.
Global fashion house Cotton On Group is one of the few Australian retailers to have first-hand experience – through its stores in the US and Britain – of competing with Amazon.
The Geelong-based fashion empire, which operates 1500 stores across seven brands in 19 countries, overhauled its online business ahead of Amazon Australia’s launch last month.
The revamp brings together the bulk of its brands under one group website and, of critical importance, gives it a mobile-first emphasis.
Cotton On has also launched its first loyalty program to make better use of a customer base running into the millions, widened its “click and collect” service and signed up as a founding member of Australia Post’s “Shipster” service covering deliveries for a set fee.
All of which indicates that Cotton On, which has trialled selling products through Amazon in the US, will be choosing to compete against the online goliath – in Australia, at least.
“We will consider all options,” Cotton On Group ecommerce general manager Brendan Sweeney said. “Does it make sense depending on the size of the market place? Is it a good destination for our customers? Is it going to bring us incremental business? Does the commercial case make sense?”
Mr Sweeney points out Cotton On sells though various online fashion platforms in other markets.
Its Asian arm taps online fashion platform Zalora – the Asian equivalent of The Iconic – while in South Africa, its products are available through Superbalist.
But Mr Sweeney notes Cotton On is no longer using Amazon – which sells everything – in developed markets such as the US.
“What we learnt out of that is that going to a destination fashion marketplace that has the right demographic of customers and where we can showcase our brand properly is a better fit for us,” Mr Sweeney said of the group’s experience of selling through Amazon.
While Cotton On is focused on creating its own online marketplace – and leveraging a customer database it is only in the early stages of mining – Mr Sweeney says Amazon will be good for Australian consumers.
Australian retailers have already upped their game, with JB Hi-Fi introducing three-hour delivery, Woolworths rolling out click and collect nationally and Myer launching its own online lifestyle marketplace.
Mr Sweeney argues it will also push logistics companies to improve service.
“They (Amazon) will help everybody sharpen up their act and hopefully drive an improvement in some of the delivery and logistic operations around the country as well,” he says.
“They will definitely get more people in Australia to become regular online shoppers and that increases the market for everybody.”
The move to overhaul Cotton On’s online offering is its most significant investment in its e-commerce business to date.
It is testing the new offering – housed under the Cotton On & Co label – in various markets around the world.