It’s been a few months since the leadership team at 35-year-old women’s wear chain Chico’s FAS followed in the footsteps of many apparel brands before them that have decided to hop on board the runaway Amazon train.
And why not? Amazon moves a lot of clothing and is on track to become the top online apparel seller this year, according to Morgan Stanley. Though the likes of Nike and Calvin Klein have formalized partnerships with Amazon, too, myriad fashion firms fear Amazon will eat their lunch—and already Amazon’s private-label efforts have borne fruit, and then some. Experts estimate the Seattle-based retailer’s own brands could reach $25 billion in just four short years.
While apparel companies continue to debate whether Amazon is a friend or foe, Chico’s FAS weighed, measured and decided to embark on what it hopes will blossom into a long and rewarding relationship selling apparel and accessories targeted at mid-life women on the influential e-commerce platform.
So what, exactly, finally convinced Chico’s?
Among many reasons, brand management and the ability to control intellectual property (IP) were huge factors, senior vice president of business development George Z. Nahra said at the CommerceNext conference in New York City Thursday. Though it may sound counterintuitive, he explained, Chico’s believes working with Amazon head to head will go a long way toward keeping close tabs on brand assets and IP.
“If there are counterfeiters selling [our] products on Amazon, it’s easier working with Amazon to get them to remove them versus not,” said Zahra, who claims this was a factor in Nike’s Amazon partnership too.
“Amazon will help you reactively, not proactively, manage counterfeiters,” he continued. “They will give you tools. They can be good partners. You still have to monitor the site—they’re not going to do that for you.”
From marketing and product detail pages to brand landing pages and pricing, Chico’s arrived at the conclusion that forging the Amazon deal would afford greater control over its destiny on the platform. “We felt that while not the most elegant shopping experience—it’s more utilitarian—at least we’d have control over what the customer sees when she gets on the [Amazon] site,” Zahra noted.
Of course, Amazon’s world-class logistics prowess is enticing, too, Zahra admitted, as is its clout as a vehicle for customer acquisition. But the SVP said Chico’s took stock of its own shortcomings and looked to the online retail leader to lend a bit of its magic—especially from the “innovation perspective,” which “is not our core competency.” With Amazon making bigger moves into offline in recent years, the company seemed especially gifted in “tying physical and digital.”
One of the best outcomes from the relationship so far is the decision to accept purchases conducted on Amazon as in-store returns. Chico’s has managed “probably dozens and dozens” of such returns to date, which Zahra stressed has been a valuable avenue for building relationships with shoppers who may be new to the brand.
In the months and years ahead, Zahra is bullish on the chances that Amazon will improve its UI and UX. “I think they’ll innovate the experience,” he said. “They’ve said they want to win apparel. They need to win food and apparel.”