Amazon Canada gets fashionable with new category
Amazon Canada has opened up its closet, and it’s full of designer jeans and Nike runners.
The online retail giant will begin selling apparel and footwear to its Canadian customers on Thursday, one of the few categories Amazon. ca had yet to introduce since debuting in this country as an online bookseller in 2002.
In the past two years the Seattlebased company has stepped up its selection of products significantly as Hudson’s Bay, Canadian Tire and Best Buy began to penetrate the digital space more aggressively. In the past year, Amazon.ca has more than doubled the number of discrete items for sale to 100 million.
The Amazon.ca clothing shop makes its debut selling 1.5 million items for men women and children, and features a range of wellknown brands, from True Religion to Puma.
“I think it is a game-changer,” said Sandy Silva, fashion and beauty industry analyst at market research firm NPD Group in Toronto.
“There are some hesitations to buying apparel online until there is a comfort from the consumer with (how items) fit,” she said. “Categories that require a little more attention to fit might be a little bit more challenging. If Amazon can figure out how to crack that nut in the way they have with many of the other categories that they participate in, it will call into mind other ways for everyone else to do business. This is a reason why understanding the e-commerce channel is becoming more and more important every day for retailers.”
NPD’s tracking surveys indicate consumers are becoming more willing to buy apparel online than they were in the past, and Amazon executives have seen stepped-up consumer search activity in the category.
“In aggregate, we are seeing a lot of interest online for shoes and apparel,” said Alexandre Gagnon, country manager for Amazon.ca.
Gagnon would not disclose how much clothing Canadians are buying online at U.S. website Amazon. com. Bricks and mortar retailers such as J Crew have faced a consumer backlash when debuting their websites in Canada after years of revealing their U.S. prices online.
Industry experts note consumers are particularly sensitive about the prices of apparel and footwear, both subject to tariffs in this market.
Still, clothing remains a particularly delicate category for any retailers online due to higher-than-average return rates in the category. And while footwear sales are catching on, 90 per cent of retail industry shoe sales in Canada are still conducted in bricks and mortar stores.
“In general we will price according to the local market,” Gagnon said. “When it comes to clothing and shoes, we will follow a series of markdowns that will be relevant to our inventory position in the country.”
With the exception of streaming video, Amazon Canada now carries most of the categories it offers in the U.S., though analysts predict any video service would face the same industry obstacles over digital rights that curtail Netflix in Canada.
The retailer has added more than 20 new merchandise categories to its Canadian offering since 2013, including dry grocery, auto parts and jewelry.
“There are a small number of categories left on the U.S. website that we may add,” Gagnon said.
The news comes a month after Best Buy Canada made a move to take on Amazon in the arena of marketplace-style selling, offering up its website and its 192 bricksand-mortar stores for other retailers to use for online customer pickups and returns.
A Canadian e-commerce report last month from BMO retailing analyst Peter Sklar estimated Amazon generated retail sales in the range of $1.8 billion to $2 billion in Canada in 2014, between shopping at Amazon.com, Amazon.ca, and Amazon’s other international marketplace sites.
As with other Amazon Canada categories, apparel and shoes will offer free shipping to consumers on orders of more than $25 and sameday delivery on eligible orders.