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Amazon.com, Inc. (AMZN) Is Claiming More and More Shopping Segments

Amazon.com

Amazon.com, Inc. shoppers are buying more and more apparel, according to a new survey. Data from Cowen & Co showed that the number of Amazon customers who said they bought clothes there jumped 35% in November compared to a year ago.

Amazon.com Inc. (AMZN)

Frightening Prospect for Rival Retailers

Earlier this year, Cowen had forecast that Amazon would surpass Macy’s as the top U.S. apparel retailer by 2017.

“We estimate AMZN’s US retail Apparel GMV grows from $16BN in ’15 to $52BN in ’20, with US market share rising from 5% to 14% and comfortably passing Macy’s in ’17,” analysts there wrote in July.

The note to clients also said that over the past six quarters, Amazon’s apparel sales growth averaged 29% y-o-y. Contrast that to the 3% and 2% dips at Wal-Mart and Target, respectively. Furthermore, the first half of 2015, saw close to 11% of apparel buyers at Wal-Mart and Target switch to Amazon, compared to 8% during the first half of 2014.

Frightening prospect for rivals indeed.

Amazon ‘Broadening its Customer Footprint’

In the latest Cowen Consumer Survey, analyst John Blackledge polled 2,500 U.S. consumers to deduce the average household income and median age of shoppers at major retailers. Blackledge found that buyers at Amazon.com, Inc. have an average household income of $62,900, with a median age of 40. The Prime subscribers, on the other hand, have an average income of $69,300 and median age of 36.5 years.

Overall, Amazon’s average shopper earns almost 8% more than those at other major retailer. However, in a surprising twist, the survey showed that the e-com giant is slowly losing that advantage. The 2014 average household income of an Amazon shopper was $63,000, which was less than the 2013 tally of $63,900.

Blackledge ascribes this slide to Amazon “broadening its customer footprint.”

Amazon Primed for More Good Times?

Cowen estimates there were close to 41 million Prime members last month, accounting for about half of its shoppers. That’s up 1 million from the previous month. Amazon is pushing hard to lure more customers to Prime by offering attractive benefits that include Prime Now one-hour delivery and free same-day delivery in select cities.

“Amazon continues to grow its Prime subscriptions in the U.S. at a very healthy rate, despite more than one in three internet-connected households indicating they live in a Prime household,” Cowen said.

The survey also revealed that Prime subscribers are now shopping across more categories than they did a year ago. The top shopping categories for Prime members last month were electronic goods priced less than $50, followed by books, toys and video games.

Shares of Amazon.com, Inc. closed Thursday at $666.25. The stock is up more than 110%, and is trading close to its life time high.

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Based in Saudi Arabia, Siraj has a strong understanding of and passion for accounting and finance. He has worked for international clients for many years on several projects related to the stock market, equity research and other business, accounting and finance related projects. Siraj is a published financial analyst on the world's leading websites including SeekingAlpha, TheStreet, MSN, and others.

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