The Bad News Of Luxury Industry? Domestic Down Jacket Suddenly Becomes Amazon Explosion

Traditional luxury consumers are beginning to realize that spending less and spending less is becoming fashionable. Global worries about the economy, climate change and sustainable development seem to be radically changing people's desire to buy luxury goods.

According to the latest news of the financial times, a women's dresser made in China, priced at US $139.99 or about 940 yuan, suddenly hit the bestseller list of Amazon, the largest retailer in the world. It has been the sales champion of Amazon's down coats and coats for two consecutive years, almost occupying the wardrobe of all American women, and is known as the "Amazon coat".

The down jacket comes from the Orolay brand, with multiple zippers and pockets. The exterior design is similar to the classic "cocoon" coat of the luxury feather brand Moncler and Balenciaga. According to public information, Orolay was founded in 2006 and is officially launched online in 2010, mainly for consumers in North American and Western European markets. The parent company Jiaxing Zi Chi Trading Co., Ltd. is a comprehensive enterprise integrating design, manufacturing and distribution business. This implies that Orolay has a huge advantage in cost and operational efficiency.

In the rare winter weather in the United States, the price is only 10% of the price down of the Canadian geese and Moncler brands and spreads at a viral rate. Amazon has more than 6000 evaluations of this down garment, of which more than 80% are rated by four or 5 stars, and consumers have commented that the down jacket is very hard to buy, and revealed that 20 women wore this coat when walking.

A consumer living in the upper east side of New York compared the Orolay down jacket to the Moncler that was just released, or the black down jacket of The North Face, which was born in the 90s of last century. Ana MariaPimentel, the fashion director of Neiman Marcus, said she had seen her mother's friend buy the same dress after wearing the Orolay down jacket. "It feels almost everywhere."

Some analysts pointed out that the Orolay down jacket burst red, and even invaded New York luxury core market is behind the spanformation of the concept of traditional luxury consumers, especially in the uncertain environment, "saving money" or will become the trend of consumption of affluent groups.

In addition, frequent occurrence of public order problems is one of the reasons for the rich consumers' desire to buy luxury clothing. In January this year, 7 cases of gunmen looting canadian goose coats in Chicago took place in just ten days.

One surveillance video showed a white Mercedes car parked in the street where the victim walked. A man jumped from the back seat and forced the sleeve of his men's coat. Then another man jumped out of the car, suspected of carrying a gun, robbed the victim and forced the removal of his Canadian goose down jacket. Several other cases also included trailing victims into apartment buildings and snatching canadian goose down coats.

In addition to strengthening patrols, Chicago police also advised people to change their brands to their jackets. Some consumers said in an interview with Cbs Broadcasting Inc that they are preparing to buy a cheaper coat, just in case it happens. He thought it was disappointing to spend a lot of money on Canada goose, but now he can't enjoy it. And when people interviewed Chicago NBC, they said, "now we really can't wear anything good anymore."

Some people in the industry said that the "Amazon jacket" proved to a certain extent that investors worried and questioned Amazon's threat to the luxury industry earlier. Although the one-off craze is a feature of the fashion industry, there is a big difference between the market's fanaticism and the sensation caused by fashion products. This means that Amazon, which controls the big data of consumers, is gradually becoming the destination for high-end consumers to buy cheap fashion.

This is a nightmare for the luxury goods industry.

JohannRupert, the chairman of Cartire's parent group, has warned three years ago that if the technology giants such as Amazon, Google and Alibaba decide to get involved in fashion, the luxury group will face a threat.

Since 2012, fashion apparel is the main development target of Amazon, and has achieved remarkable results so far. Morgan Stanley has released a report forecast that Amazon will occupy 7% of the clothing sales market share to 19% before 2020. Now it has become the second largest apparel retail group in the United States after WAL-MART.

A survey by Morgan Stanley's research firm Alphawise found that about 69% of consumers in the United States had bought clothes in Amazon in the first half of 2017, a 10 percentage point increase over the same period last year. 61% of consumers believe that Amazon's brand is improving and its credibility is improving. About 42% of respondents said they spent more time and money on clothing than ever before.

Since 2017, Amazon has continued to exert its efforts from the clothing sales platform to the upstream apparel supply chain, the self dress brand of the platform and the end consumption experience, so that the pressure of the traditional clothing retailers is increasing.

According to Bloomberg, people familiar with the matter said, Amazon is also working with some of the biggest sportswear suppliers to develop its own brand of sportswear, which will lead to a new wave in the noisy industry, bringing the world's biggest sports brands to new competition. Amazon has already stepped into its own brand fashion industry, launching Goodthreads, Paris Sunday and other professional wear, jackets and dress brands.

At the same time, Amazon launched the beta PrimeWardrobe "trial and buy" service, that is, Prime members can enjoy the online order, send home clothes to try on, and choose the clothes left in 7 days, and then put the rest in the PrimeWardrobe box to send this special service.

As one of the members of Amazon Prime, the service not only sends two-way freight free, nor does it charge extra service charges. You can order at least 3 pieces and 15 clothes at most. The order fee will also enjoy the corresponding discount according to the number of users who decide to leave. Finally, 3 or more orders will enjoy a discount of up to 20 percent off. But at present, the service is in the testing stage, and only invite some members to experience it.

What makes the luxury retailers feel alert is that the brand covered by "PrimeWardrobe" is not only popular Adidas, J.Brand and Levi's, but also the high-end brand of Calvin Klein, HugoBoss and Theory. Some analysts believe that in the future, Amazon will continue to embrace the middle end and light luxury brands. Brands such as Michael Kors and KateSpade, which are dragged down by the US Department store industry, are also demonstrating to Amazon.

However, the problem of counterfeit goods is still the biggest short board for Amazon to enter the luxury industry. Luxury brands always care about other brands, but most of Amazon's products are still popular. Counterfeit goods are also a chronic illness that can not go around in any case.

The industry's doubts about Amazon's sale of counterfeit goods began in 2014, allowing Chinese sellers to sell products directly to the platform, pushing Amazon's sales up 20% in a year, and its total revenue exceeded 100 billion dollars for the first time last year.

The US financial news channel said in a report that Amason has always advocated the idea of "user first". But because of not paying attention to the quality of products, Amason's electronic business platform is gradually becoming the distribution center of Shanzhai products. If Amason platform stops the sale of counterfeit goods, it will aggravate the phenomenon of counterfeit goods flooding through various platforms, leading to a decline in consumer confidence.

After being prosecuted and attacked by LouisVuitton, Hermes and other brands, Amazon finally faced up to its counterfeit problem this year. In its annual report to the US Securities and Exchange Commission, it first mentioned that the company could not stop the illegal, counterfeit and pirated products that store sellers might sell through Amazon. CNBC analysts stressed that this report reflects Amazon's concerns about its platform fakes, which had never been mentioned in the annual report.

What surprised the luxury industry is that the number of members of Amazon Prime has reached 101 million. As of December 31, 2018, 62% of Amazon's US customers have become Prime members, with an average cost of $1400 a year, and non Prime members spend an average of $600 a year. Amazon is imperceptibly affecting the lives of high-end consumers from the acquisition of WholeFoods, the expensive food retailer, the total food supermarket, and the acquisition of Zappos, which is famous for its rich products and lower prices, from the $1 billion 200 million acquisition of organic lifestyle.

As more and more millennials of quality and fashion become the main consumer force, Amazon's technology driven and consumer shopping experience as the core of the development path is responsive to the needs of future consumers, which will also become a major driving force for Amazon. The richness of products, the new experience of online and offline, and the fast and convenient logistics, the three links have built a more solid and coherent system for Amazon.

Amazon CEO Bezos said that in the next few decades, the retail industry will not change three points. First, customers like low prices; second, customers prefer faster delivery; third, customers want more and faster choices.

Amazon is not the only business tycoon stepping into the luxury industry. After launching the LuxuryPavilion, a luxury e-commerce platform in 2017, China's Alibaba group has become the biggest threat to Western luxury goods industry.

And the success of the Orolay down jacket also stems from China's ultra fast production response. When demand is surging, Chinese manufacturers can quickly provide more colors and sizes and highlight the opportunities of "made in China" in the fashion industry from side to side.

At the same time, China's down garment market is entering a new growth period. The rise of domestic down jacket brand Bosideng has also captured the business opportunities of Moncler and Canada geese in China to a certain extent. After returning the focus of its business to the core of its down jacket products, Bosideng's stock price doubled 2.2 times last year, and became the first clothing brand to be sold in advance during the double eleven period. During the holiday of new year's day, the store on Bosideng line also caused consumers queuing up.

In fact, with various mergers and acquisitions, the days of European rule in the luxury industry have long ceased to exist, and the boundaries have become increasingly blurred. However, some people in the industry pointed out that luxury and fashion brands face three challenges if they want to achieve greater growth. That is, the new generation of consumers will gradually form personalized fashion awareness, declining purchasing power and changing preferences.

Young consumers are more and more inclined to "pre test and buy". Klarna, a global payment service provider, recently released a research report on "pre test and buy". After investigating 1000 Z generation and millennial consumers, Klarna found that younger generation consumers increasingly attach importance to seamless, personalized and flexible shopping experience. Over 66% of respondents said that a free and simple return policy is a key factor in improving online shopping experience, and indicated that if they could try clothes before buying, they would be willing to pay a higher price.

According to McKinsey's latest report, the growth rate of the global fashion industry will slow to 3.5% to 4.5% in 2019 after a brief recovery, slightly lower than in 2018. The report also stressed that the UK's departure from Europe and the global economic slowdown will start to penetrate the fashion industry. It is clear that the new round of shock has already begun to emerge.