NB_1170x120

Walmart acquires online clothier Bonobos for $310 million

Print Friendly, PDF & Email

The news came as Amazon.com encroached on Walmart's turf with a bid for Whole Foods Market.

BENTONVILLE, Ark. — Walmart will acquire Bonobos Inc. and place the men’s apparel retailer under the umbrella of its Jet.com e-commerce unit.

Bonobos serves a young and loyal base of male shoppers that is less price-sensitive and focused on quality, according to retail analyst Deborah Weinswig, managing director at Fung Global Retail and Technology. Bonobos sells men’s suits, dress shirts, outerwear, golf wear and accessories, mostly online but also through about three dozen brick-and-mortar locations.

“Apparel is now the frontier of the battlefield between Walmart and Amazon,” Weinswig wrote in a report on the acquisition. “The agreement to acquire Bonobos demonstrates Walmart’s continued determination in remaining competitive and tackling Amazon head on.”

Walmart has been bolstering its online capabilities through acquisitions of apparel brands, including shoe seller ShoeBuy, outdoor apparel retailer Moosejaw and women’s clothing seller ModCloth.

“Walmart’s acquisition strategy in the e-commerce market appears to be following a pattern,” Weinswig wrote. “The acquisitions of Modcloth, Moosejaw, Shoebuy and now Bonobos underscore that Walmart is determined to revolutionize its apparel offerings. Walmart’s winning formula of focusing on mass-market standard offerings across all product categories has brought the company unprecedented success, and consumers can easily purchase relatively standardized products at all of its shopping centers. However, in order to target a niche group of customers with specific preferences, Walmart needs products that are more personalized in design and style, which would not be practical within its current business configuration. These recent acquisitions of niche retailers appear to be the catalyst to drive future growth.”

The acquisition is subject to regulatory approval and is expected to close later this year.

Since acquiring Jet.com last summer, Walmart has significantly altered its e-commerce business. The company installed Jet founder Marc Lore as head of its e-commerce efforts in the United States and gave him a mandate to expand quickly. In addition to bolstering its brands offerings, Walmart’s e-commerce business introduced free two-day shipping without requiring a membership fee, as Amazon does. It drastically expanded the number of items being sold online. And it established a new online division, Store No. 8, to hatch new online businesses.


McClane_728x90

VAG_728x90

Comments are closed.