Cowen, which simultaneously upgraded Amazon from "market perform" to "outperform," forecast in its research note that Amazon's gross merchandise value in apparel and accessories will grow from an anticipated $16 billion in 2015 to more than $27 billion in 2017.
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That figure would easily best Macy's anticipated sales of $24.69 billion in those categories in 2017, which would represent only a slight uptick from Cowen's forecast for nearly $24 billion this year.
By its estimates, Amazon would grow from about 3 percent share of total U.S. retail sales in 2014 (excluding autos and gas) to 6.9 percent by 2018, Cowen said.
"Amazon's growth in clothing and accessories introduces additional competition for traditional retailers but presents a new opportunity of distribution for global brands that can effectively segment product between their own stores/website, the traditional wholesale partners and Amazon," Cowen's analysts wrote.
For years, Amazon struggled to gain traction with its fashion business, as retailers were hesitant to enter into partnerships with an online store known for its low prices. Aside from these worries about diluting their brands, Cowen said retailers have also voiced concerns about Amazon using data from their products to test pricing strategies or negotiate its own deals with manufacturers.
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Aside from expanding its vendor base, Amazon has jazzed up its fashion presence by sponsoring the inaugural New York Fashion Week men's shows this month, and opening a photo studio to better feature its products.
"Given how rapidly Amazon's fashion business has grown in size, we believe it is becoming increasingly more difficult for brands to ignore," the analysts wrote.