Wells Fargo estimates that Amazon’s attire and footwear gross sales within the U.S. grew by roughly 15% in 2020 to greater than $41 billion, which is 20% to 25% above rival Walmart.
“This represents extremely spectacular 11%-12% share of all attire bought within the U.S. and 34%-35% share of all attire bought on-line,” Wells Fargo analysts Ike Boruchow and Tom Nikic wrote in a word. “We now estimate Amazon will surpass $45 billion in attire/footwear gross sales in 2021.”
For years, Wall Road analysts have predicted Amazon will leapfrog Walmart to say the highest spot within the U.S. attire market. Amazon discovered early success by offering a wide range of basics, but it surely has since expanded its style enterprise. It now includes a rising slate of title manufacturers. The corporate additionally launched online luxury fashion shops final fall.
Workers make preparations for a launch celebration at Amazon.com Inc.’s new style pictures studio within the Shoreditch district of London, U.Okay.
Simon Dawson | Bloomberg | Getty Pictures
The pandemic cemented Amazon’s dominance in the retail space. Caught-at-home shoppers turned to the net retailer for necessities like bathroom paper, in addition to nonessentials similar to workplace furnishings and exercise gear. Shoppers additionally turned to Amazon for items and companies they won’t have bought from the corporate earlier than the pandemic, like grocery supply.
Amazon now claims a 30% to 35% share of the net attire and footwear market, Wells Fargo stated. “To place this in perspective, Amazon bought nearly 7x as a lot attire/footwear because the second largest participant on-line (Macy’s),” the analysts added.
Though Amazon has remodeled right into a prime attire participant, Wells Fargo stated the corporate may nonetheless make enhancements to the buying expertise, like carrying extra of the manufacturers that customers need. Amazon has turned off some manufacturers previously, and that might be hurting its skill to develop choice on the location, Wells Fargo stated.
“Till Amazon turns into a platform that works with firms to raise manufacturers, quite than viewing the connection as transactional, firms who’re fiercely protecting of their manufacturers (e.g. Nike), won’t promote to Amazon,” the analysts stated.
In 2019, Nike grabbed headlines when it announced it could now not promote its garments and sneakers on to Amazon. Different manufacturers — together with Birkenstock and PopSockets — have additionally pulled out of Amazon in recent times, citing points starting from counterfeits to aggressive pricing ways.
Correction: This story was revised to appropriate that the evaluation was by Wells Fargo.