Amazon provides a platform for third-parties to sell their products to consumers. Some third-party companies take their own orders and ship their own products, while others have Amazon fill and ship their orders on their behalves. Selling over the Amazon platform has helped many companies broaden their product awareness, visibility, and sales.
Amazon, however, subsequently became, and continues to become, a competitor of their own retailer clients (and of many other retailers) by entering into its own agreements with suppliers and manufacturers, as they’ve done in the auto after-market industry (with Federal-Mogul, Dorman Products, et al.), and in sportswear, with Nike (in the works). In the area of fashion apparel, Amazon is making a big push into retail sales of its own inventory (as opposed to only being a platform for sales by third-party vendors to consumers of their own respective fashion products) with its own proprietary brands as well as with some established brands.
With regard to Amazon’s strategy to become a fashion retailer of its own owned inventory (as opposed to that of third parties), well-known, high-end fashion brands/manufacturers have been hesitant to sell product to and through Amazon (though their product can often be found there from other vendors, such as licensees, distributors, retailers, and other inventory purchasers). But, many fashion brands/manufacturers are in the process …every second of every day… of evaluating how they will exist, survive, and grow in an Amazon world (just as Nike has been evaluating in recent months), where other retail outlets are rapidly disappearing or being marginalized- a big factor in Nike’s decision to cooperate with Amazon.
Maybe their best option, in some cases, is to sell their entire brand to Amazon.
Now that Amazon has bought Whole Foods, one has to wonder how long it will be until Amazon buys one or more luxury fashion apparel brands. While (depending on the deal terms) it can make sense from a profit perspective, such an acquisition would be especially valuable to Amazon from an Amazon branding perspective. Owning and selling a major fashion brand on Amazon, without any marketing or distribution limitations, and without any competitive outlets for such brand (i.e. having exclusivity), would instantly lift the cache and profile and viability of Amazon/Amazon Prime as a high-end fashion retailer. From that position, Amazon could buy more luxury brands, and/or launch additional upscale brands of its own, and/or attract other high-end brand manufacturers to its platform.
One could take the position, especially in the wake of the Nike deal, that Amazon need not make any such expensive acquisitions- that Amazon is already holding all the cards in retail, and, sooner or later, everyone will cave to Amazon; the other position, though, is that Amazon has the distribution- so why not own the content (the content being the brand) and make the margin and have exclusivity by way of brands developed in-house (as it is doing), as well as through acquisitions of brands that are already internationally recognized and in demand? A fashion brand acquisition could make simple financial sense for Amazon while also helping Amazon to build its high-end fashion image in the minds of consumers and manufacturers- at a supersonic pace.
So, don’t be surprised if one day in the near future an item in your wardrobe has the label: Gucci- The Jeff Bezos Collection .
fn.  Gucci is being used here for the purpose of illustration only. No such deal with Amazon is pending or under consideration.
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About the Author
Neil Siskind is: President of The Siskind Law Firm, focused on product investments, trademark licensing, product distribution, and real estate; Founder & Chairman of The Fatherhood Assignment™, a think tank and advocate for children with absentee fathers; Founder of the global charity marketing initiative, Caring is Free®; Founder of National Fatherhood Day™; Owner & Conservator of The Neil S. Siskind Nature Preserve, over 7 acres of conserved waterfront land along New York’s majestic Hudson River; and author of The Complete Guide To The Ways To Manufacture & Sell Your Products.
Other Recent Articles by Neil S. Siskind:
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- Romney vs. Trump: Does Mitt Romney Respect the Value of Business Branding?
- To “Loan” is not to “Own”
- How the Sharks……Tank
- Is Licensing a Trademark Worth it?
- Distribution is King
- Why the “Affluenza” Defense is So Dangerous
- A Shark, a Chicken, and a Trademark
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