For years those folks that consider themselves among the trendiest around have stayed away from Amazon, preferring the thrill of trying on the hottest clothes in stores. But that is starting to change, according to new research from Goldman Sachs.
Says Goldman strategist Alexandra Walvis in a new note Thursday:
"Amazon leads as a preferred retailer in mainstream fashion, with the platform realizing increased affinity this year in almost all categories across our national sample. We found this dominance surprising in several categories where top brands are not often official partners with Amazon, such as handbags, briefcases, and luxury products. Men remain more likely to choose Amazon, but women now indicate Amazon as their top destination for clothing, handbags, and premium/luxury brands, and as a close #2 in several other categories."
The Goldman team thinks interest in buying fashionable wares off Amazon is only one reason to scoop up the tech giant's stock:
"We continue to believe Amazon's progress across apparel categories will mirror its steady press forward in every other category it has prioritized (electronics, media, cloud computing, etc.): start small, leverage 3rd parties, use scale to attract brands, and gradually grow the footprint until any brand not working with it loses access to one of the fastest growing pools of consumer spending. Ecommerce growth remains on an accelerating trend, as demonstrated by two consecutive years of accelerating growth reported by the CB and survey results highlighting a doubling of respondents increasing their online shopping versus last year. In short, not only do we believe Amazon remains a driver of that trend but also the primary beneficiary as its scale and consumer value proposition grow with further share shift. In addition to ranking as the top shopping app across all cohorts, Amazon continues to gain share as a retailer across individual categories. Notably, Amazon surpassed Nike for the #1 spot in shoes across multiple cohorts and now ranks #1 among clothing retailers across all cohorts, except It Girls, with still improving trends. Surprisingly, Amazon moved to #1 among luxury retailers across 4 out of 6 cohorts, highlighting the strength of its 3rd party network and strategy, in our view."
Goldman has a $2,300 price target on Amazon and obviously, a buy rating.