As Birkenstock Cuts Ties, Again, Amazon is Making Friends but Losing More

After officially cutting ties with Amazon in the U.S. early this year, Birkenstock has said “enough!” for a second time, swearing off the e-commerce marketplace in the European Union, as well. According to a statement released by the footwear company on Monday, “Birkenstock and its affiliated companies are terminating their business relations with Amazon EU with effect from January 1, 2018. On this date, Birkenstock will completely discontinue direct deliveries provided by the U.S. online retailer’s Luxembourg-based European subsidiary.”

The statement goes on to assert, Birkinstock, “the long-standing family-owned enterprise, asserts a claim against the world’s largest online retailer that there have been a series of violations of the law on the Marketplace platform operated by Amazon, which the platform operator has failed to prevent of its own accord. On a number of occasions, Birkenstock lodged a complaint that counterfeit products of poor quality which infringed Birkenstock’s trademark rights and misled the consumers regarding the origins of goods were being made available on the platform.”

And still yet, Birkenstock stated that it “is of the [company’s] opinion that an integral part of a trusting business relationship is that, upon being first notified as the operator of the Marketplace platform of such a breach of the law, Amazon would, of its own accord, do everything within its power to prevent this type of and similar infringements."

To this day, according to Birkenstock, "no binding statement has been made to the effect that no more counterfeit Birkenstock products would be offered for sale through the platform. Instead, there were further legal violations of a different nature in recent months which Amazon failed to proactively prevent.”

As a result, Birkenstock says it will “now terminate its business relations with the online retailer in Europe, too.”

More than Just Birkenstock

This is one of a handful of very recent oppositions – both in and out of court - highlighting the Seattle-based e-commerce giant’s alleged failure to commit to “proactively police its site for counterfeits and unauthorized retailers,” as Swatch Chief Executive Nick Hayek put it recently, after the two companies’ partnership negotiations fell through for this exact reason.

In October, Mercedes Benz’s parent company, Daimler AG, filed suit against Amazon.com based on its “lack of effective regulation.” In addition to calling foul on the sale of infringing and counterfeit goods by third-party marketplace sellers (which is what almost all of the lawsuits involving platforms like Amazon have alleged to date), Daimler alleges in its suit that Amazon, itself, is actively selling counterfeit goods by way of its “Ships from and sold by Amazon.com” products.

All of this comes just over a year after LVMH – the Paris-based conglomerate that owns Louis Vuitton, Givenchy, Celine, Loewe, Dior, and Marc Jacobs – made headlines when its Chief Financial Officer Jean-Jacques Guiony told investors in a conference, "There is no way we can do business with [Amazon] for the time being."

Making (a Few) Friends

Interestingly, despite the overwhelming lack of goodwill that Amazon has garnered amongst many fashion industry entities, it has managed to woo Calvin Klein, which inked an exclusive deal with the e-commerce giant for the holiday season.

Together, the two are collaborating pop-up shops in New York and Los Angeles, which run from November 16 until December 31 and play home to exclusive styles of Calvin Klein undergarments, including cotton bralettes and striped panties. These styles will not be available by way of any other retailers until January.

As the Wall Street Journal reported last month, “Customers who visit the pop-up shops can purchase items through Amazon’s mobile app. The dressing rooms will feature Amazon Echo devices that can answer questions about the merchandise, control the lighting and play music. Shoppers at the pop-up stores will be able to customize their purchases with embroidery.”

As for whether Amazon will be able to find additional brands to partner with, that may not matter in the long run. The site has not-so-secretly been working to develop its own in-house collections (it currently boasts 41 private labels, 29 of which are apparel/fashion related), such as fast fashion line, Find, for instance, which launched in Europe this fall, and according to L2 Digital, these lines are gaining traction amongst consumers. For instance, Amazon Essentials accounts for 3 percent of Best Sellers across all clothing categories on the Amazon platform, beating out adidas, Nike, and Calvin Klein.

With such inroads being made by Amazon, it is potentially removing the need for friends altogether.