Amazon has changed the face of retail over the past 20 years, but it hasn’t had much success in the luxury goods market. Now he’s trying something new. Online retailer Neiman Marcus has bought a small stake in the retailer and will reportedly provide data and logistics to Neiman and its new owner, Saks Fifth Avenue.
Yesterday, Saks Fifth Avenue and parent HBC announced the acquisition of Neiman Marcus (which also owns Bergdorf Goodman) for $2.65 billion, bringing the largest US luxury retailers under one roof. The Wall Street Journal informed. Amazon is a minority investor in the deal, which is still subject to regulatory approval.
“How do you future-proof a brand like Saks, Neimans or Bergdorf? You do it through technology,” said Saks CEO Marc Metrick. Bloomberg. To this end, Amazon will collect high-quality customer data, analyze it to offer more personalized options and improve logistics.
Amazon has tried to enter the luxury retail market over the years, but major brands have had nothing to do with it. “We believe that the Amazon business is not a perfect fit for LVMH and does not fit our brands,” LVMH He said in 2016. The only place LVMC (which owns Louis Vuitton, Dior, Givenchy and other labels) does business is in its own retail stores, at retailers like Neiman Marcus or its own site.
Luxury brands in Europe earned the right block online sales of products by third parties if they feel it is damaging to their image. In addition, the EU ruled in 2010 that brands with a market share of less than 30 percent could be prevented from selling their goods by online retailers.
Amazon has tried to break brick-and-mortar retail with varying degrees of success. Its ownership of Whole Foods is a positive example, but it has cashier-less Go stores mostly failed to fly
With the acquisition of Neiman Marcus by Saks parent HBC, Amazon is taking part in an organization expected to generate $10 billion in total annual sales. There’s no word on the size of Amazon’s investment, but it seems like a relatively safe bet compared to the more radical brick-and-mortar experiments it’s tried in the past.
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