Amazon Launches Luxury Stores: Will Amazon Re-Engineer Online Luxury Shopping?

Note: Today's post is more about fashion business than law.

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Image Source: Vogue Website

Amazon recently announced that it plans to hire 100,000 additional employees as the demand for Amazon keeps soaring amid the pandemic. The online platform's expansion knows no boundaries. On September 15th, Amazon launched "Luxury Stores", its first-ever online platform dedicated to luxury brands. The platform is currently operating on an invitation-only basis. With Oscar de la Renta as its first partner, the platform offers a select group of customers the opportunity to see the brand's 2020 Fall/Winter collection pieces and to buy them at their fingertips. (To give a sense of exclusivity, no other platforms other than Oscar de la Renta's own boutiques and website currently carry items from its 2020 Fall/Winter collection.) 

Would Luxury Stores entice high-end luxury brands to participate in this new venture? In a press release, Christine Beauchamp, President of Amazon Fashion, analogized Luxury Stores to a "store within a store". Amazon points out that participating brands can benefit from Amazon's proven merchandising tools that are designed for the optimal personalization of each customer while "independently mak[ing] decisions regarding their inventory, selection, and pricing". I take her statement to mean that Ms. Beauchamp envisions Luxury Stores as the digital reincarnation of a concession store in a brick-and-mortar department store. (To learn more about the concession store, read my previous post.) However, there is no free lunch in life. Although I do not have access to the contract between Amazon and Oscar de la Renta, there must be some covenants, or promises, to which the latter is subject to at the request of the former. 

Skeptics point out that luxury shoppers won't pay a visit to Amazon when they are nicely curated luxury online platforms already operating in the retail space. A touted innovative feature, such as View in 360 (a feature that allows viewers to appreciate how select garments will look on diverse body types and skin tones), might not be alluring enough to induce discerning shoppers to switch to Amazon, or even use it as a complementary addition to their existing list of go-to sites for luxury goods. No one can tell with certainty the future of Luxury Stores at this point. All I can say is that Amazon Fashion has been really serious about its expansion into the luxury world, as evidenced by its continuing anti-counterfeiting efforts. The first sign of success, I believe, would depend on how many luxury brands Amazon can secure in the coming months.