What was years in the making has finally happened, with Amazon passing Walmart to become the largest apparel retailer in the US.
Experts had been predicting Amazon would overtake Walmart for years. Like many other transformations, however, the pandemic is what finally pushed the online giant across the finish line. As individuals remained in lockdown and avoided crowded stores, Amazon’s business went into overdrive.
According to Wells Fargo, via CNBC, that was enough to help it surpass Walmart in the apparel space, with its apparel and footwear growing an estimated 15% in 2020 to more than $41 billion. That gives it a solid 20% to 25% lead over Walmart.
“This represents highly impressive 11%-12% share of all apparel sold in the U.S. and 34%-35% share of all apparel sold online,” wrote Wells Fargo analysts Ike Boruchow and Tom Nikic. “We now estimate Amazon will surpass $45 billion in apparel/footwear sales in 2021.”
Interestingly, the outlook was not all roses for Amazon, as there are still some high-profile brands that refuse to sell on the online store. Much of this is due to the way Amazon approaches the business, focusing on sales over helping companies build their brand.
“Until Amazon becomes a platform that works with companies to elevate brands, rather than viewing the relationship as transactional, companies who are fiercely protective of their brands (e.g. Nike), will not sell to Amazon,” said the analysts.
“Especially today, younger consumers want to connect emotionally with brands,” says Manny Chirico, CEO of apparel company PVH, which owns many lifestyle brands including Calvin Klein and Tommy Hilfiger. “They don’t want to just aspire for your brand looking down the runway, they want to be part of the life of the brand. I think Tommy Hilfiger does it well.”
Manny Chirico, CEO of apparel company PVH, which owns many lifestyle brands including Calvin Klein and Tommy Hilfiger, discusses how the company has turned around by focusing on ecommerce, technology, and connecting with young consumers. He was interviewed on CNBC:
Consumer Experience is Critical
You have to be willing to make the investment. I think we really have done it (turned around the company), from not only a brand marketing point of view, but investing in all the new technologies and investing in the ecommerce platforms that really will drive the business going forward. Our stores are highly profitable and we need to continue to invest in those stores. The consumer experience is critical and we’re making connections with a younger and younger consumer.
We’re all dealing with the challenge of the distribution models changing, but fundamentally we’ve always been a multi-channel retailer. We have big businesses in brick and mortar, both direct-to-consumer in our own stores and through our key wholesale partners like Macy’s here in the US or Galeries Lafayette in Europe. Those key players we continue to invest back into those platforms.
Younger Consumers Want To Connect Emotionally with Brands
The challenge with that high-end collector fashion business is are you connecting with a younger consumer today and how do you make your investments as you as you go forward? I think it needs to be more balanced than it’s been. Especially today, younger consumers want to connect emotionally with brands. They don’t want to just aspire for your brand looking down the runway, they want to be part of the life of the brand.
I think Tommy (Hilfiger) does it well. We just have a fashion show in Paris with Tommy selling product immediately after that trying to connect with the consumer at more affordable price points than what you would see from the luxury point of view. That’s how you build big businesses. We’re not trying to build niche businesses selling just $2,000 men’s suits or evening gowns. We’re really about building big lifestyle businesses.
Levi Strauss began trading on the New York Stock Exchange this morning under the ticker symbol ‘LEVI.’ By mid-afternoon, the stock was at $22.66, substantially higher than the price offered to institutional investors. It’s clear that investors believe that Levi’s can leverage technology and innovation to successfully compete online and in brick and mortar stores.
Levi Strauss Soars in NYSE Debut
Charles Bergh, CEO of Levi Strauss, discusses how technology and innovation are driving increased sales and market share in an interview with CNBC coinciding with their IPO:
We Are Denim and We’re the Market Leader Globally
We are denim and we’re the market leader globally. A lot of people as we were doing the (IPO) roadshow said aren’t you guys just riding the denim wave? We’re creating the denim wave. We’ve been driving the category with innovation across our men’s business and our women’s business. We’ve expanded to other categories. Last year we finished with 14 percent growth coming off of 8 percent growth the prior year. The business is really humming right now.
I believe this is sustainable for the long term. Maybe not double digits forever. But we’ve got clear runway for growth across the categories that we’re competing in. We’re building share in our core categories and expanding to new categories. Last fiscal year, when we finished the year our growth was really broad-based. If you looked at it in the categories where we competed we grew every single category. If you looked at it by geography we grew every single geography. If you look at it by channel we grew across wholesale, including US wholesale, which is a little bit of a melting iceberg right now. We grew in our own brick-and-mortar and ecommerce. It was very broad-based growth last year and we’re confident we can continue that.
We Have Built a Very Big Platform for Big Data
First of all, to be successful it does come down to strong brands. Consumers at the end of the day love an emotional attachment with their brand. We’ve recreated that that love for Levi’s. We have built a very big platform for big data. In fact just a couple of weeks ago we announced that we’ve hired a head of advanced analytics and machine learning who will sit on the executive team and report directly to me. We are mining the data that we do collect and really turning it into revenue.
Our strategies are working and one of the key strategic choices that we made seven years ago, shortly after I joined, was to become a leading world-class omnichannel retailer and it is working. The mix has shifted to omnichannel. When I joined the company it was about 20 percent of our business. Today, it’s almost a third. It is faster growing than our wholesale business and we’re continuing to invest in it. Most of our capital investment is going into retail and ecommerce and knitting that seamless consumer experience together.
Implemented New Instance of SAP and Investing in RFID
It (IPO funds) is going to go into continued investment in building out our omnichannel. So both brick-and-mortar retail as well as our ecommerce business and then knitting it together with technology. For example, we’re implementing a new instance of SAP and investing in RFID (radio frequency identification). We’ve implemented RFID across our business in the US and UK and that’s actually really turning into money. Every one of the products in our store is tagged with RFID.
I’ve actually had this experience happen to me myself in our new Times Square store. There was an item I wanted to buy and they didn’t have it in my size. A stylist came over and scanned the tag and she could see that my size was available in the back room. Just two minutes later I was in the dressing room trying it on. A year ago before our RFID that would have been a lost sale. That just wouldn’t have happened. It gives us instant clear visibility to the inventory in our store, both in front of house as well as back of house.
Levi’s Driving Market Share Through Product Innovation
Back in 2013 and 2014, the headlines were the death of denim. It was all about athletic tights and Lululemon tights. It became a throwdown moment for us as a company. We have an innovation center a couple of blocks from our office. We brought our suppliers, the mills that make denim for us, into that innovation center. We understood what women were really telling us by wearing tights. That used to be a denim occasion. They wanted soft stretchy comfortable material that made them look great and gave them confidence. That was what was driving that conversion. So we innovated around soft stretchy comfortable denim which we can now do. We developed proprietary four-way stretch so that women don’t get baggy knees, which is their biggest dissatisfier.
We relaunched our business in the middle of 2015 and we’ve grown 14 quarters in a row and in the last eight quarters at double-digit rates. It has been a huge part of our growth. We were under $800 million just on women’s bottoms about three years ago. We’re over a billion dollars today. We are number one globally with a nine percent market share, but we’re not number one in a number of markets including right here in the US. So I really do believe we can continue to grow at an accelerated rate on our women’s business. There are lots of what I like to call share donors out there for us to build share while we’re building the category.
We haven’t seen any (backlash to being an American brand). This brand stands for everything good about America. Freedom, democracy, and allowing people to express themselves. Authentic self-expression is what the Levi’s brand is all about. We’ve not seen any backlash. None. We think there are lots of opportunities still for us. I am not worried at all about denim. We are denim and we’ll continue to drive this category through great innovation and marketing that connects with consumers and sends them into our stores.
Technology and Innovation Powering Levi Strauss Growth Strategy
“You will see the continuous expansion over the next year into many different categories,” says Rent the Runway CEO Jennifer Hyman. The company just raised additional funds at a $1 billion valuation. “Anything that you do not use every single day, we want to make it fiscally irresponsible for someone to not have a subscription to Rent the Runway. We’re trying to build the Amazon Prime of rental.”
Jennifer Hyman, CEO of Rent the Runway, discusses in an interview on CNBC how her company benefits from the growing sharing economy and how ultimately she envisions Rent the Runway becoming the Amazon Prime of rental:
We Benefit From the Advancement in the Sharing Economy
It’s been 10 years since we’ve been working hard to pioneer this new form of dynamic ownership. Ten years ago we were not a darling of the industry and really had to partner with designers to show them that this was an entirely new customer base for them and a new revenue stream. This is just how young people are thinking about ownership across the board. I actually think we benefit from the advancements in the sharing economy. If you think about how this concept of dynamic ownership where we have unlimited choice and the ability to use whatever product we want whenever we want it, our digital worlds have already moved there.
That’s how we consume entertainment. That’s how we consume music. The idea that you would have that closet in the cloud for the physical world and that form of dynamic ownership, the Millennial Generation Z consumer is so ready to adopt this behavior. That’s what we’ve seen since we launched our subscription, just this dramatic growth and acceleration, not only in how many users we have but in how frequently they use the product. They’re using it 120 days of the year with the unlimited subscription, which is now 70 percent of our revenue.
Dynamic Ownership Applies to the Closet, the Home, and Beyond
Think about how frequently millennials are moving and how your home has become this new bastion of self-expression. Your home used to be a private space and now because of social media, it’s as public as you taking photos of yourself every single day. So the ability to continuously dynamically change your home and have new items arriving we really think that this idea of dynamic ownership applies to the closet, the home, and beyond.
Think about all the things that you don’t have to use every single day and bringing that into the physical world and think about the sustainability of this as well. The millennial and younger customer really cares about the fact that there’s a huge amount of waste. Over 80 percent of the closet is not used regularly. So to create a new contract with the customer where she could have the variety that she wants but she doesn’t have to accumulate all of this stuff that she doesn’t use. You couple that with the fact that this younger generation is living in cities where you don’t even have the space to house all of the extra stuff that you might have put in your garage.
We’re Trying to Build the Amazon Prime of Rental
It (revenue) really depends on the item. That metric changes every year based on our cost to serve, which goes down every year. It also matters what cost we procure the inventory at. We started a model last year which is a platform where brands are giving this inventory on consignment and we actually are revenue sharing with them on that inventory. It’s our own version of fulfilled by Amazon and it’s now a new revenue monetization stream for the 600 brands that we work with.
You will see the continuous expansion over the next year into many different categories. Anything that you do not use every single day, we want to make it fiscally irresponsible for someone to not have a subscription to Rent the Runway. We’re trying to build the Amazon Prime of rental. Rent the Runway is primarily a logistics company. What we really do is we restore physical goods to perfect condition before we send them out to the next customer. We now know all of these different data points about any given fabric, how to restore it to perfect condition and how to maximize the turns while it still looks brand-new.
Urban Outfitters has done it again. The often overpriced clothing company has offended the masses again by selling what appeared to be a blood-spattered Kent State University sweatshirt.
Most people who have been through high school are aware of the Kent State massacre. The incident occurred in 1970 in Kent, Ohio. Students all across the country were protesting the expansion of the Vietnam War, and the National Guard was at the Kent State campus. At one point during the protest, some guardsmen opened fire on protesters, killing four students and injuring nine others.
Urban Outfitters, a company known for offering offensive apparel at times, put what was described as a “vintage Kent State sweatshirt” for sale on its website for $129. According to the item description, Urban Outfitters only had one for sale and encouraged shoppers to “get it or regret it.”
Check out a picture of the offensive Kent State sweatshirt below.
As you can see from the photo, the sweatshirt appears to have blood spatters in the chest region, as well as other parts of the shirt. The blood-spattered shirt brought memories of the Kent State massacre to mind, and Urban Outfitters immediately came under fire after news of the shirt started going around.
The stunt pulled by Urban Outfitters regarding Kent State is absolutely outrageous. I am calling for a boycott until the shirt is pulled.
The listing for the blood-spattered Kent State shirt has since been removed from the Urban Outfitters website. The company has issued an apology for the shirt and says that it was all a big misunderstanding. According to the apology, the shirt was part of Urban Outfitters’ sun-faded collection, and the red stains were never intentionally placed on the shirt.
Check out the apology below.
Urban Outfitters sincerely apologizes for any offense our Vintage Kent State Sweatshirt may have caused. It (cont) http://t.co/o3oKyPJFu8
Urban Outfitters sincerely apologizes for any offense our Vintage Kent State Sweatshirt may have caused. It was never our intention to allude to the tragic events that took place at Kent State in 1970 and we are extremely saddened that this item was perceived as such. The one-of-a-kind item was purchased as part of our sun-faded vintage collection. There is no blood on this shirt nor has this item been altered in any way. The red stains are discoloration from the original shade of the shirt and the holes are from natural wear and fray. Again, we deeply regret that this item was perceived negatively and we have removed it immediately from our website to avoid further upset.
This isn’t the first time Urban Outfitters has sold offensive clothing. The company once sold a shirt with Holocaust connotations and also sold Navajo hip flasks. Considering that this is at least the third time Urban Outfitters has crossed the line, many people aren’t too sure about the company’s apology.
The U.S. Postal Service (USPS) has announced a new partnership with Cleveland apparel manufacturer Wahconah Group. The companies will create the “Rain Heat & Snow” line of apparel and “accessory products.”
The clothes will be designed around the unofficial USPS creed, “Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds.” The clothing will feature USPS branding and could include some sort of “smart apparel” electronic devices.
“This agreement will put the Postal Service on the cutting edge of functional fashion,” said Steven Mills, USPS Corporate Licensing Manager. “The main focus will be to produce Rain Heat & Snow apparel and accessories using technology to create ‘smart apparel’ – also known as wearable electronics.”
This announcement comes soon after the USPS announced a net loss of $1.3 billion during the first quarter of its 2013 fiscal year. As a result of that announcement, the company has planned to use a congressional loophole to end Saturday mail delivery on August 5. USPS estimates that cutting Saturday mail delivery could save as much as $2 billion each year. Though that may be enough to help the Postal Service limp through another year of declining First-Class Mail volume and government-mandated pre-funding of retiree health benefits, it seems that the company is now looking for outside-the-box solutions (such as fashion) to its money woes.
Adidas and the Golden State Warriors this week unveiled a new uniform with “modern” short sleeves. The uniform is also the team’s lightest uniform ever – 26% lighter than current Warriors uniforms.
“Players on every court like to have a unique sense of style,” said Lawrence Norman, vice president for adidas global basketball. “We were excited to work side-by-side for the last 18 months with the Warriors, one of the NBA’s youngest and most exciting teams, to develop this unique uniform system that helps maintain peak player performance while ensuring comfort, fit and style.”
Though range-of-motion would seem to be a concern with sleeves, adidas claims its has worked with players to develop the uniforms. The sleeves include armhole insets that are made of a stretch fabric. The company claims that movement in the jersey is equal to that found in normal tank-top style uniforms.
“When adidas began working with us to develop the short sleeve jersey, I couldn’t wait to wear it in a game,” said Harrison Barnes, Warriors forward. “I love the fit and style the sleeves give me on the court.”
The new uniforms will debut on February 22 during the Warriors’ game against the San Antonio Spurs. They will also be worn during two more home games this season: on March 8 against the Houston Rockets and on March 15 against the Chicago Bulls.
I used to think this joke was funny. Then, like most denizens of the interwebs, I saw it everywhere and it lost any semblance of humor. Then, I saw this shirt – and I’m pretty sure that I want it.
Skyrim players will immediately recognize the joke contained in today’s deal of the day at woot.com’s spin-off site for daily t-shirt deals. It references probably the biggest gaming joke in the last year – various guards across the Skyrim landscape telling you how they used to be adventurers, before they took an arrow in the knee.
That little joke spawned countless parodies and cross-over memes, for example:
And everyone got sick of it, as is the fate of most dead horses that get beat by the internet community into mushed-up unrecognizable versions of themselves. But now I see this shirt, and I realize that it glows in the dark, and I think to myself, “Do I like this because of some ironic impulse to troll anyone who gets the joke? Or do I just think it’s awesome?”
The shirt designer, Tobe Fonseca, says he used to be a designer, but then…you know. Hurry and catch the deal today on woot, but if you miss the chance, I’m sure it’ll pop up on eBay soon enough.
Are you so addicted to Facebook to the point you want to decorate your dwelling with a look and feel that matches the Facebook layout? What about your shower curtain? If so, you’re in luck.
Introducing the Social Shower Curtain, which is named after the familiar format that inspired it. Naturally, the avoidance of the “Facebook” trademark applies here, hence the generic name. While the name may not say Facebook, the shower curtain’s look certainly does. As you can see in the lead image, the standard blue bar runs across the top of the curtain, and it also features such niftiness like “Shower Head Tagged you in a Photo,” and “Wash Basin Wants to be unblocked.”
There’s also a space for the profile picture, in this case, your head while you’re behind the shower curtain. Unfortunately, the shower curtain itself is not connected to the Internet, so what you essentially have is something to let people know how much you like Facebook, and if you’re willing to pay 14.99 in British Sterling in order to take a shower behind the Facebook layout, perhaps the word “addicted” was used incorrectly.
Perhaps the word I’m looking for is insane.
As it stands, the curtain will be available soon, and they are currently taking orders at SpinningHat.com. How long until there’s a shower curtain that’s actually connected to Facebook, allowing members to inform their friends that there’s soap in their eyes, or something equal meaningless? Is this a must have item for you? Let us know what you think.
