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Should Stitch Fix Be Worried About Amazon’s New Fashion Foray?

Bringing a personalized approach to its war on retail competitors in the fashion arena, Amazon launched its own styling service.

Last week, the company announced the debut of Personal Styling by Prime Wardrobe, the e-commerce giant’s take on the subscription box model.

Available exclusively to Amazon Prime members, the program prompts shoppers with a questionnaire probing into their style and fit preferences. From there, Amazon Fashion’s team of stylists pulls recommendations from more than half a million items from thousands of brands including 7 for All Mankind, Calvin Klein, Levi’s, AG Adriano Goldschmied, Rebecca Taylor, Champion, Adidas, Amazon Essentials and more.

Shoppers can review the stylists’ picks before they’re shipped, and they have 7 days to try on their wares and waffle over decisions. Once they’ve decided what they’d like to keep, consumers are charged only for those items, and everything else can be returned using a resealable package and pre-paid label.

If the concept sounds familiar, it’s because Stitch Fix launched with a nearly identical business model in 2011, mainstreaming the concept of curated fashion through a subscription service. On Tuesday, the company’s stock took a 4 percent hit following Amazon’s Personal Styling by Prime Wardrobe announcement. Other brands have iterated on the model with variable success, including American Eagle, whose stock dropped 1.4 percent on Tuesday.

While Stitch Fix appears to have the most to lose if the service takes off, legacy retailers like Nordstrom, Macy’s, J. Jill, Gap and Chico’s FAS could face troubles too. On Tuesday, those brands’ stocks were down between 1 and 2 percent across the board on the heels of Amazon’s news.

The concept of personalization is top of mind for both newcomers to the retail space and industry stalwarts. AI and machine learning tools are making it possible for brands and retailers to deliver a more specialized, digestible selection of product directly to consumers’ smartphones—and ultimately to their doorsteps.

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While Amazon claims to have a team of stylists working for Prime Wardrobe, it’s likely that the process is aided, if not completely directed, by machine learning tools. According to Amazon’s blog, the more each customer uses Personal Shopper by Prime Wardrobe, “the more [the company’s] stylists learn about what they love, making it easy to help them find new and exciting looks to try every month.”

It’s no surprise that Amazon, which has been inching its way into the fashion arena with shopping tech tools like StyleSnap and its own Amazon Essentials brand, would use its tremendous trove of consumer data and wealth of AI expertise to its advantage. Consumers are hungry for a more personalized retail experience, and retailers are itching to deliver.

Sourcing Journal released its 2019 Personalization Report this spring, which solicited input from 308 stakeholders across apparel, footwear and accessories industries. Data revealed that 68.9 percent of respondents believe consumers expect customized options, and while 42.6 percent of respondents said their companies were unlikely to implement mass customization or made-to-measure options in the near future, opportunities abound for retailers with the tech tools to curate product selection.