Calvin Klein is signing over its underwear business and cozying up to Amazon.
The brand announced it will now sell all of its underwear styles exclusively on the marketplace, opting to eschew its retail partners including Macy’s and Urban Outfitters, and build upon the existing sales momentum it maintains on the site. According to a report by L2, Calvin Klein not only ranks among the highest performing brands in Amazon’s men’s underwear category, but it also has several products on the e-commerce juggernaut’s best-seller list. While the brand has found success on the platform, other brands on the site are feeling the competition from Amazon’s private-label offerings, which continue to gain popularity.
Overall, Calvin Klein’s success on the platform is consistent with L2’s findings that low-price basics and staples (like Hanes, for example, which ranks just above Calvin Klein on the top-seller list) continue to dominate Amazon’s apparel and accessories categories.
Part of what makes essentials like underwear so successful is that consumers still aren’t sold on Amazon as a bonafide fashion destination, despite recent efforts like the launch of its try-before-you-buy service, Prime Wardrobe. Though fashion partners Kate Spade and Levi’s are starting to come aboard, average consumers still aren’t turning to Amazon to shop for bigger purchases like several-thousand-dollar coats.
In Calvin Klein’s case, it benefits from long being known for offering traditional looks and moderately priced basics alongside its pricier high-fashion collections. (On the site, Calvin Klein sells a collection of women’s and men’s basics, as well as fragrance, outerwear and select home goods.) It holds a certain brand affinity that works on Amazon, said Raul Mandru, co-founder and creative director at RXM Creative.
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“Calvin Klein has consistently invested in brand campaigns that have simply become part of today’s culture, keeping the brand relevant and top of mind,” Mandru said. “It’s a brand that is known to an incredibly large demographic, whether or not everyone who has awareness of the brand can afford it or not. Having Calvin Klein on Amazon makes that sector of the brand more approachable for a wider audience than normal.”
Thomas Rankin, CEO of Dash Hudson, said part of Calvin Klein’s success is its focus on working specifically with Amazon as an early partner of the platform. Over time, Calvin Klein has built a mutually beneficial relationship with Amazon that has ultimately helped it secure higher prominence on the site, which has translated to more sales.
“Brands that concentrate exclusively on specific platforms tend to get favored by those platforms,” he said. “Calvin Klein has proven to be a great fit for Amazon and Amazon’s customers, which is evidenced by its performance. This performance would, in turn, make Amazon more likely to provide CK with favorable placement and advertising terms.”
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However, L2 warned that Calvin Klein’s strategy may not work for similar brands, as Amazon’s own collections continue to gain traction on the site. This holiday season, in particular, Amazon is turning to major shopping days like Black Friday and Cyber Monday to promote its private labels, and has shared a gift guide featuring items from its various brands like Lark & Ro and The Lovely Tote.
“As Amazon expands its private label offerings, lower-priced non-designer brands might want to be wary of following a similar approach,” L2 researcher Elisabeth Rosen wrote in the report. “In the men’s apparel category, Amazon’s private label brand is already displacing legacy brands that offer similar items in terms of style and price.”
Angela Seits, director of social and influencer marketing at PMG, said that, while Calvin Klein’s approach isn’t a one-size-fits-all strategy, it’s a smart move amid the ongoing “retail apocalypse” afflicting mall brands and department stores. Whether brands like it or not, Amazon serves as an important digital channel to continue to make sales.
“With department stores on the decline, Amazon is quickly becoming the new storefront for many established brands, but selling exclusively on Amazon is certainly not the right answer for every retail brand,” she said. “Amazon currently lacks the dedicated space to tell a brand’s story – and without offering a unique brand experience, the consumer shopping journey becomes purely transactional and promotional.”
For Calvin Klein, Rankin said there’s also concern in offering exclusive products on a platform like Amazon, as a result of its limited scope. Amazon Essential products edging out brands like Hanes and Dockers on Singles’ Day is also a harbinger for future trouble among traditional brands selling on the site.
However, Rankin said the partnership will likely continue to be beneficial. It’s already led to one innovative venture: holiday pop-ups currently running in New York City, where consumers can go to purchase the underwear using the Amazon app.
“Calvin Klein underwear has a pretty broad appeal and it has been commonly found within discount and commercial retail establishments for years,” he said. “From an e-commerce perspective, though exclusivity comes with some risk, it sounds like a perfect fit for Amazon and Calvin Klein.”
