Dive Brief:

• Amazon will leap-frog over Macy’s in apparel sales to become number one in that category in the next couple of years, according to research firm Cowen and Company.

• Amazon’s U.S. retail apparel GMV [gross merchandise value] will grow from $16 billion in 2015 to $52 billion in 2020, with U.S. market share rising from 5% to 14% and comfortably passing Macy’s in 2017, wrote Cowen retail analyst John Blackledge in a note Monday.

• The apparel category, which Amazon didn’t enter till a decade ago, is helping drive sales of electronics and general merchandise as well, which make for most (70%) of its revenue, Blackledge says.

Dive Insight:

How do you like Amazon now? After suffering some backlash and mixed reviews over its Prime Day last week, Amazon this week is getting a lot of love from various analysts, who appear to be quite sanguine about its long-term prospects.

That’s in contrast to what appears to be Macy’s falling fortunes and a new focus on unleashing its real estate value, which could become a distraction to its retail opperations. 

Amazon’s apparel growth could also be besting those of Wal-Mart and even Target, which has a designer-led advantage seen in its recent blockbuster limited-edition Lilly Pulitzer line. And more customers who buy clothing at those retailers also bought from Amazon this year so far.

"Amazon is winning in large retail and tech markets given long-term investments, per our proprietary data/analysis," Cowen analyst John Blackledge wrote. "We expect Amazon to be the number-one U.S. apparel retailer by '17, driven by accelerating purchaser growth, and continue to gain traction in other retail verticals."