Walmart Steps Up Fashion Game with $310-Million Bonobos Acquisition

Press enter to search
Close search
Open Menu

Walmart Steps Up Fashion Game with $310-Million Bonobos Acquisition

They've been in talks for months, but it's finally official: Walmart will acquire Bonobos, Inc., one of the leading apparel brands built on the internet, for $310 million in cash. Following the closing, Andy Dunn, founder and C EO of Bonobos will report to Marc Lore, president and CEO of Walmart U.S. e-commerce, and oversee the company's collection of digitally-native vertical brands. These are brands born online, and owned from design through distribution. The brands will be offered on and possibly other Walmart brands in a variety of countries over time, and include Bonobos and recently acquired indie fashion brand ModCloth.

The acquisition, which is subject to regulatory approval, is expected to close toward the end of the second quarter or the beginning of the third quarter of this fiscal year. 
RSR managing partner Paula Rosenblum hails the move as a "smart strategy" that's very much in line with Walmart's recent acqusitions of Moosejaw, the outdoor retailer, and ModCloth. "It's an extension of Walmart's strategy to go after a different target market, since they've tapped out their core market," she added.

The announcement comes at a time of growth and innovation in e-commerce for Walmart. In its most recent quarter, Walmart saw 63 percent growth in U.S. e-commerce sales, the majority coming from organic growth in Walmart's efforts in e-commerce are empowering customers with low prices, more choices and new levels of convenience. Since just the beginning of the year, has rolled out two-day free shipping with no membership fee, an extra discount for picking up orders in stores and the ability to easily reorder online or store purchases. And, continues to provide a strong avenue for reaching an urban, Millennial customer.

"We're seeing momentum in the business as we expand our value proposition with customers and it's incredible to see how fast we're moving," said Lore. "Adding innovators like Andy will continue to help us shape the future of Walmart, and the future of retail. I'm thrilled to welcome Andy and the entire Bonobos team. They've created an amazing product and customer experience, and that will not change. In fact, Andy will be a great influence on the company, especially in leading our collection of exclusive brands offered online."

The acquisition of Bonobos and the leadership of Dunn will create more new products for consumers and new ways to buy them.

"We began Bonobos ten years ago to give men a completely different product and shopping experience: better fitting, higher quality clothing, in new and imaginative ways. That will always remain our mission," Dunn said. "We are excited about applying all that we have learned to help shepherd in the next era of retail."

The addition of Bonobos is part of a broader e-commerce strategy to enhance the customer value proposition, including:
  • Offering customers low prices and convenient ways of getting the items they buy every day, like food and consumables;
  • Offering a vastly expanded assortment while building expertise in key long-tail categories, like apparel and home; and
  • Adding best-in-class owned, vertical consumer brands to be sold on those brands' properties, and over time,
"Walmart has really stepped up to Amazon's pace, both as a hyper retail innovator and in its growing e-commerce strength through acquisitions. The Bonobos acquisition is another peg in the upward direction," said Charles Dimov, director of marketing, OrderDynamics. "Walmart isn't just the inexpensive goods store anymore. Kudos to them for driving retail technology with a strong omnichannel play and presence, and in breaking out of the 'low price only' paradigm. Between Walmart and Amazon, fashion, retail and groceries are in for some revolutionary times. At a time when, according to a soon-to-be released report from OrderDynamics, only 26 percent of North American retailer have an omnichannel retail strategy working, it's time to get in gear, or get left behind."

Related Topics