Oct 18, 2017
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Amazon threatens both department stores and specialty retailers, study finds

Oct 18, 2017

​A new Morgan Stanley study shows Amazon as a threat to both department stores and specialty retailers, with Amazon's new use of Nike and Lululemon's suppliers for its own private label sportswear a particular concern.


The study revealed Amazon has recently partnered with vendors used by major athletic brands including Nike, Under Armour and Lululemon, leading analysts to expect Amazon to develop a private label athletic brand. With the new vendor partnerships, Amazon will potentially have the ability to manufacture using similar fabrics as major brands but also offer product at competitive prices.

Morgan Stanley analyst Kimberly Greenberger also reported consumer purchase intentions for next year, shedding light on which retailers Amazon may challenge the most. Amazon had the highest rate of consumer purchase intention at 60%, followed by Target which had half that amount. Zara and Walmart also ranked high on the list, as well as off-price retailers TJMaxx, Ross and Marshalls.

Results were less positive for Urban Outfitters, Anthropologie, Abercrombie & Fitch, Gap and Banana Republic, with Morgan Stanley discovering a net decline in consumer intention to shop in these stores.

The study also predicts trouble ahead for Nordstrom and Macy's, whose consumers overlapped with Amazon customers. Subject to this phenomenon – dubbed the "Amazon Threat" by Morgan Stanley – these department stores have an elevated risk of losing customers to Amazon.

The study, conducted by Morgan Stanley and called AlphaWise, covers the apparel industry and is in its third year.

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