J.Crew Hitches A Ride With Amazon to Spur Sales
Add J.Crew to the list of retailers that have decided to take a pragmatic approach to Amazon.com. (AMZN)
The struggling clothing chain, whose main business is only now starting to stabilize, will sell a limited assortment of its clothing on Amazon, according to a Wall Street Journal report, betting that the company behind almost half of all U.S. e-commerce will boost its sales and exposure.
J.Crew, which last week reported its first quarter of comparable sales growth for its flagship brand in years (it also owns the fast growing Madewell brand), will offer items from its J.Crew Mercantile line of less-expensive clothes that includes $12.50 T-shirts and $39.50 jeans, the Journal reported. The paper estimates the deal represents some 2% of J.Crew’s total brand selection.
A J.Crew spokeswoman did not immediately respond to a request for comment from Fortune.
It won’t be the first time J.Crew, which until recently sold its own clothes itself via its stores and website, teams up with another retailer. The company has been selling some J.Crew and Madewell items at Nordstrom (JWN)for some time now. And with sales well below levels of three years ago, it’s not surprising to see J.Crew test the wholesale waters. Indeed, the Journal said last week J.Crew would team up with Hudson’s Bay as well.
What’s more, other retailers have also teamed up with Amazon, such as Nike (NKE), which was reluctant to do so for years and even still only sells a limited selection via Amazon itself. (Third-party sellers nonetheless sell a lot more Nike on Amazon’s marketplace.) Other retailers, notably Gap Inc, have said they’d consider it but have not yet taken the plunge.
J.Crew’s brand has suffered from years of heavy discounting that dented its aura for fashion. But the company doesn’t think teaming up with Amazon will exacerbate that. The company’s CEO, James Brett, told the Journal that J.Crew and Amazon are on the same page on that topic. “There are other discount retailers that have developed their own lower-priced versions of J.Crew,” Brett told the newspaper. “Amazon wanted to work directly with the people who created the concept.”
Brett’s precedessor, Mickey Drexler, was not as sanguine last year when asked about Amazon at a conference. As the Journal notes, Drexler feared Amazon would “take every bestseller and put it into their private label collection.”
Indeed, Amazon is in a big push to develop its own private brands. Research by Coresite Research in December found that Amazon Fashion has grown to the point it now tied with Target as the second largest U.S. apparel seller with, 37.3% of Americans having shopped for clothes at there in the last month, just a few percentage points behind Walmart.