Amazon may have accidentally given away its next big business move

Published January 4, 2017 by lagmen
Amazon boxes are seen stacked for delivery in the Manhattan borough of New York City, January 29, 2016. REUTERS/Mike Segar/File Photo

Amazon, which got it start selling books online, may soon enter the world of stretch pants and gym shorts.

The ecommerce steamroller is evidently launching its own activewear lines, according to job postings on its site spotted by Recode. “The Amazon Fashion Private Label Team is looking for a passionate product manager to join the team as we build the Amazon world of authentic activewear brands,” one posting from Dec. 20 reads.

The lines would add a new dimension to the private-label clothing brands Amazon quietly launched last year. Those focused mostly on inexpensive office-ready items, such as simple dresses and men’s dress shirts, as well as children’s clothing.

But wardrobes in the US and elsewhere are becoming more casual, sports-influenced, and stretchy. Amazon is evidently looking to capitalize on activewear’s rapid growth, which analysts believe will continue for some time to come.

Amazon would not confirm its plans, saying in an email that as a matter of policy the company “can’t comment on our future product roadmap.”

The company is well-positioned to cash in on workout clothes, even if the market is already full of competing brands. Estimates put membership in Amazon’s Prime service alone at more than 63 million. Nearly half of US households are believed to be signed up for it. Amazon doesn’t need to build a customer base; it just needs to convince existing customers to buy their yoga pants and sweat-wicking shirts in the same place they’re buying all their other stuff.

Amazon of course already knows what people want to buy. A 2015 report by financial firm Cowen and Company noted that there were 90,000 listings for Nike products alone on the site. By tracking which items are selling, Amazon can get a pretty good idea of what it should offer under its own brands. Analysts estimate that apparel is one of Amazon’s highest margin items; those margins will expand if Amazon makes its own clothes.

The move spells trouble for some of the activewear brands already vying for attention in a competitive market. Amazon’s entry will make it even more crowded.

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