Amazon’s fashion plans

An article in the New York Times (May 8,2012) describes Amazon.com’s plans to sell more fashion product, with the logic that shipping costs are independent of item price and thus fashion goods offer greater margin. Amazon does not plan to ask for markdown money when items do not sell, it plans to have no returns of leftovers, will pay a wholesale price and decide retail pricing and offers, at times, to take the entire collection. Will Amazon.com’s ability to spend its over $5 billion to improve its website and use analytics to target consumers make it the retailer to beat ? Should fashion manufacturers develop separate assortments and colors for Amazon to protect physical stores ? Will fit and coordination of looks put Amazon at a disadvantage or will it adopt the Zappos (now owned by Amazon) model of flexible returns after trying on many alternatives solve that problem ?

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About aviyer2010

Professor
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