Bonobos storefront
Photo: Bonobos

Overshadowed by the Amazon/Whole Foods deal, Walmart on Friday reached an agreement to acquire men’s retailer Bonobos for $310 million, its biggest acquisition since Jet.com.

Founded in 2007 as a pure play e-tailer, Bonobos is perhaps best known for opening “guideshops” where consumers can’t purchase anything right off the floor. Customers see and try product, get fitted, and arrange to have items mailed to them. Starting with chinos, Bonobos has extended to suits and other men’s clothing. It has 35 physical stores as well as boutiques inside Nordstrom.

With the deal, Walmart will also gain Bonobos CEO and founder Andy Dunn, who will oversee Walmart’s “collection of digitally-native vertical brands.” Besides Bonobos, they include women’s retailer ModCloth, outdoor retailer Moosejaw and Shoebuy — all e-tailers acquired by Walmart since last August’s $3.3 billion Jet.com acquisition.

Mr. Dunn will report to Marc Lore, Jet.com’s founder who heads up Walmart’s e-commerce business.

Walmart’s acquisitions of Jet.com and niche direct retailers are seen as ways to help compete more effectively with Amazon online, and its online business is gaining momentum. Online sales catapulted 63 percent in the first quarter, with most of the gains coming from Walmart.com.

Under Mr. Lore’s leadership, Walmart has added significantly more items online, introduced free two-day shipping with minimum purchase, and now offers discounts for BOPIS.

Bonobos as well as its other niche vertical brands will be offered on Jet.com and “possibly other Walmart brands in a variety of countries over time.” But the main benefit of adding niche brands such as Bonobos is to gain a better reach and understanding of younger, urban and more upscale consumers.

TechCrunch’s Ingrid Lunden saw Amazon’s move to tap Whole Food’s premium positioning as similar. She wrote, “In both cases, Amazon and Walmart have built reputations on being super competitive (read: cheap) on pricing, but they both appear to be turning a new leaf with their new waves of business.”

One risk is whether any the smaller brands being acquired will lose their cool under Walmart ‘s ownership.

BrainTrust

“With the power of Walmart’s technology, Bonobos will have the ammunition to continue to be pioneers in the digital native e-commerce businesses.”

Brandon Rael

Strategy & Operations Transformation Leader


“Walmart has to continue to be relevant to the current as well as target markets and this acquisition seems to meet the qualities of a good idea…”

Verlin Youd

SVP Americas, Ariadne


“…maybe Walmart has caught on to the obvious — its traditional core customer is an endangered species…”

Ryan Mathews

Founder, CEO, Black Monk Consulting

Discussion Questions

DISCUSSION QUESTIONS: Is acquiring Bonobos a big deal for Walmart? What potential benefits as well as risks do you see from its stockpiling of niche direct brands?

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How important is acquiring niche brands such as Bonobos to Walmart’s online strategy?

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18 responses to “Will the Bonobos acquisition give Walmart a fashion edge?”

  1. Dick Seesel Avatar
    Dick Seesel

    The news about Walmart and Bonobos was overshadowed by the Amazon headline on Friday, and understandably so because of the sheer scope and boldness of the Whole Foods acquisition. But Walmart’s news deserves some attention on its own.

    This is another case where Walmart is buying a brand that offers more digital expertise and product development skill than the company appears able to build on its own. But there is a disconnect between Walmart’s brand image and the customers who are shopping Bonobos today. Chances are good that the majority of Whole Foods customers are already Amazon Prime members too. How much overlap exists between Bonobos and Walmart, and will the association with Walmart chase away Bonobos’s most loyal consumers?

    1. celeste@pebblepost.com Avatar
      celeste@pebblepost.com

      Couldn’t agree more. These two brands have zero affinities. What job does the Walmart customer get done at Bonobos? I don’t see the fit from the customer’s point of view. This may be a case of Walmart buying tech expertise which makes sense, but at what cost to the Bonobos brand and its own existing customers?

  2. Dave Bruno Avatar
    Dave Bruno

    This is a very interesting discussion. I have yet to discern a well-defined vision behind these niche brand pickups by Walmart. Certainly Moosejaw, ModCloth and Bonobos all have appeal to younger, more upscale shoppers, as mentioned in the article, and these businesses will certainly help Walmart gain more insights into these shoppers. Beyond that, it feels like a real uphill climb for Walmart to “shed their skin” as a low-price brand and prevent that reputation from impacting these other brands. Time will tell, of course, but I wonder if it’s possible that this move is as much a reaction to Amazon’s recent expansion into apparel via eight private label brands as it is a proactive strategic ploy.

  3. Art Suriano Avatar
    Art Suriano

    We see an aggressive war between Walmart and Amazon. Amazon attempting to gain more ground in brick-and-mortar and their announcement Friday to purchase Whole Foods is another move in that direction. Walmart purchasing Jet and now Bonobos is focusing heavily on e-commerce and attempting to compete every way they can compete, mainly with Amazon. The result will be two companies who will reinvent both e-commerce and brick-and-mortar business, blending the best of technology through its conveniences and services along with in-store shopping. Ten years from now we will look back to this period as the point when it all started.

  4. Max Goldberg Avatar
    Max Goldberg

    Walmart and Amazon are in the ultimate retail arms race. Since Walmart can’t seem to create home-grown e-commerce, it has turned to acquisitions. From these acquired brands, look for the company to broaden its reach and effectiveness. Walmart wants the 90 percent of Americans that visit its stores each month to also shop online. Amazon wants to extend its 41 percent share of e-commerce into brick-and-mortar. It’s going to be an interesting battle.

  5. Charles Dimov Avatar
    Charles Dimov

    Walmart is building an omnichannel retail empire from the brick-and-mortar side, expanding into online step-by-step. Online they are stepping into higher-end fashion. This all seems like the Honda model in the ’70s and ’80s. They started as a low-end car in the market and revolutionized their brand into a mid-range premium brand that stands for quality. Could Walmart be doing the same?

    The opportunity is that customers can now buy the same great quality goods, but use their broad footprint for in-store pickups letting customers try on their purchases. Will there be brand confusion, as a risk? Yes, at the beginning, there might be. Over time, as long as Walmart lets the strong brands they purchases flourish at an arm’s length then there is a chance this won’t trouble them in the mid-longer term. It all depends on the management approach. Watching with interest!

  6. Jon Polin Avatar
    Jon Polin

    Walmart has its claws deeply into a specific consumer segment. They only have one way to go in expanding their base — more upmarket. Acquisitions like Bonobos certainly enable this. The challenge will be in integrating several new brands — Bonobos, ModCloth, Moosejaw and Shoebuy — quickly but logically. I think Marc Lore and Andy Dunn can pull it off.

  7. Bill Hanifin Avatar
    Bill Hanifin

    I agree with the others who have commented so far that the brands are not complementary. Bonobos are high quality products that are sold with a high level of custom care. They are also pricey. Therefore the advantage Walmart seeks to create through this acquisition is not immediately clear.

    As stated in the lead article, “the main benefit of adding niche brands such as Bonobos is to gain a better reach and understanding of younger, urban and more upscale consumers.” If that means the play is for customer data and segment intelligence, $310 million is an expensive price tag for customer data.

    If Bonobos will become part of the Jet group and therefore not associated directly with the Walmart brand in the marketplace, then Walmart would appear to be continuing on its path to aggregate fashion brands into a separate portfolio. Creating a wholly separate business that just happens to be under the Walmart umbrella makes the most sense.

  8. Ryan Mathews Avatar
    Ryan Mathews

    So … here’s a thought for all those that might think this is an odd acquisition, maybe Walmart has caught on to the obvious — its traditional core customer is an endangered species. They aren’t extinct yet, but they will be in a decade or two. Forget omnichannel — a word that makes me break out in hives every time I type it. Walmart is in the process of exploring ways to transfer its brand promise, equity and values to a digitally native market and I say good for them. Ten or 15 years from now — assuming they survive, and that may be a bullish position — today’s “niche direct” brands will be the Walmart brand. Times are changing. Consumers are changing. The only thing, in fact, that isn’t changing are traditional retailers. Walmart deserves some credit for understanding those Boomers and Gen Xers looking for a $3 tee shirt aren’t going to be around forever. Times moves on and so, so it seems, does Walmart.

  9. Brandon Rael Avatar
    Brandon Rael

    From an e-commerce branding perspective, the Walmart acquisition of Bonobos further expands their reach and competitive edge in the e-commerce world. However, Walmart would be wise to enable Bonobos to continue to run their operations as they stand, as Bonobos has a well established yet evolving business model with their innovative guide shops and outstanding customer experience. The model has significant advantages, as Bonobos saves on inventory costs and real estate.

    The strategy will continue to work well if Bonobos continues as an autonomous business. They have a very loyal Millennial and Generation Z following who do not necessarily align with the traditional Walmart customer. However, with the power of Walmart’s technology, resources, capital and infrastructure, Bonobos will have the ammunition to continue to be pioneers in the digital native e-commerce businesses, helping to bridge the gap between the physical and digital with their multi-sensory guide shops.

  10. Peter Charness Avatar
    Peter Charness

    I can’t think of a match with less in common than Bonobos and Walmart (OK they both sell apparel). I suspect Bonobos has more of a core competency in digital and more of an interesting business model than does Walmart, but I frankly don’t see much applicability of one to the other.

    1. Verlin Youd Avatar
      Verlin Youd

      Peter, maybe you’ve nailed it on the head. They may be buying to get additional digital competency, business model innovation, and incremental customers.

  11. Phil Rubin Avatar
    Phil Rubin

    Three thoughts on Walmart buying Bonobos, especially contrasted against Amazon’s purchase of Whole Foods Market.

    1. If you consider Amazon’s now 20-year obsession with customers and Walmart’s lengthier obsession with low prices and size, it’s hard to relate to what Walmart is trying to achieve if it has anything to do with either Walmart’s or Bonobos’ customers.
    2. As a fairly loyal Bonobos customer and someone who only shops Walmart to pay attention to what’s going on there, this deal is a turn off. As someone who devotes his professional life to customer marketing, it’s equally a turnoff.
    3. Walmart’s core acquisition — i.e., Jet.com — was smart given Amazon’s lead over Walmart in digital commerce. This deal might buy Walmart some talent, but it’s not going to be overly accretive nor is it going to be explicitly synergistic. Again, contrast this to Amazon and Whole Foods sharing a core customer base of more affluent customers, a commitment to those customers and commitments to making the world better and it’s difficult to see Walmart with a brilliant grand strategy here.
    4. Beyond Andy Dunn’s implied interest in working with Jet.com’s Marc Lore, which could be quite palpable, it’s hard to see other Bonobos employees being terribly excited about working for Walmart. By contrast, there is tremendous enthusiasm at Whole Foods about working with Amazon.

    If I ran a long/short hedge fund this would lead me to (remain) being long Amazon and short Walmart.

  12. Lee Peterson Avatar
    Lee Peterson

    To me, this is all about understanding how showroom stores work. Think: if you didn’t have to have huge inventory levels, you could have smaller customer space, and if you had smaller customer space, you would have more space to turn the rest of your store into a fulfillment center. Whether it’s BOPIS or ship to home, stores will become half fulfillment, half experience, and this is one leaping step towards that end.

    The fashion element here is an ancillary benefit.

  13. Verlin Youd Avatar
    Verlin Youd

    Makes total sense to me. Walmart has to continue to be relevant to the current as well as target markets and this kind of acquisition seems to meet the qualities of a good acquisition; strong management, strong brand, strong operating model, complimentary competencies, complimentary customers along with a bit of overlap, and likely earnings positive. If Walmart is going to remain competitive, let alone relevant in the future, they must be making moves like this. Interested to see their next moves too.

  14. Ricardo Belmar Avatar
    Ricardo Belmar

    There are many interesting discussion points with this acquisition by Walmart. It’s hard to find an immediate synergy between Walmart and Bonobos. Unlike Amazon and Whole Foods where there is likely plenty of overlap with Amazon Prime customers, it’s unlikely the apparel shopper that buys Bonobos is also shopping for similar product at Walmart. Walmart’s approach to these acquisitions seems to be to build out a portfolio of higher-end brands to focus on e-commerce with a slight nod (but not focus) to brick and mortar sales. Walmart is looking to grow its customer base and in one way this is acknowledging that everyday low price can only bring them so many customers. They want to grow into higher-end, potentially higher-margin categories, and the existing Walmart brand isn’t likely to credibly attract those customers.

    The risk is more with Bonobos and the other brands they’ve acquired. Will their existing customers be turned away due to fears of Walmart altering their favorite brand? Only time will tell.

  15. William Passodelis Avatar
    William Passodelis

    Watching the back and forth fight and competition of these two behemoths (Walmart and Amazon), ongoing, seemingly independent and without thought or concern for other competitors (i.e. in relation to the complete and unfortunate lack of relevance of potential competitors), focused only on one another and both understanding need to get to where they each need or want to be…. I continue to be fascinated and mesmerized!

    This is not a surprise to me at all. Lack of similarity between WM and Bonobos is fine, actually even beneficial. WMT can learn from the Bonobos customer, but more importantly — look at the blossoming empire being constructed!

    Jet.com
    Then, sports: MooseJaw
    Shoes: ShoeBuy
    Womens: ModCloth
    and now…
    Mens: Bonobos

    Walmart already has grocery and continues to get better at Walmart online, the construction of an entire (department) e-commerce world that can fulfill whatever is neededIt is brilliant and not done yet, but starting to, or actually very much taking shape into the wonderful potential platform that Walmart may have online!

    I have no doubt that rooms of strategists at Amazon are daily digesting and evaluating the possibility that Walmart is building towards. If I were Walmart, I might try and get a spy into Amazon to try and discover benefits that Amazon may be afraid of that perhaps Walmart online division had not thought of….

    The ability to build and integrate these pieces will be a large task for Mr. Lore. But I think he is up for the challenge and while I respect and admire the incredible ability and smarts of Mr. Bezos, I am glad for if nothing else, good old fashioned capitalist competition, that there is one player with the ability and wherewithal to go full steam ahead and attack in its own right! The next decade is going to be incredible!

    (Personally, as a former Kroger guy I just hope Kroger can maneuver and survive — and hopefully somehow prosper in the change, and possible craziness, to come!)

    Thank you all!

  16. Alex Senn Avatar
    Alex Senn

    Yes, this acquisition has a few points about it which don’t exactly line up. Who knows how it will actually end up, but if Walmart looks to include Bonobos shops within a classic Walmart, I’m not so sure this will cut it with consumer expectations at both companies, nor does the Bonobos model support this. However, if Walmart were smart they could combine their new successful digital native brands into a new store format all it’s own already popular with younger, more affluent shoppers.

    The problem is Walmart has so much brand equity wrapped around low prices, which inherently means low quality to any educated Bonobos-esque customer. Now if Walmart integrates the two companies, this would open up a large data set to Walmart of upper-middle class Millennials. Walmart could use this to personalize the product set shown to these customers. Essentially this would come down to understanding the higher income level needs of this type of consumer and make them understand that Walmart has a high value, high-quality line as well, which they should consider in their purchase decision.

    It’s a tough sell, nonetheless it will be interesting to watch play out.

18 Comments
oldest
newest
Dick Seesel
Dick Seesel
6 years ago

The news about Walmart and Bonobos was overshadowed by the Amazon headline on Friday, and understandably so because of the sheer scope and boldness of the Whole Foods acquisition. But Walmart’s news deserves some attention on its own.

This is another case where Walmart is buying a brand that offers more digital expertise and product development skill than the company appears able to build on its own. But there is a disconnect between Walmart’s brand image and the customers who are shopping Bonobos today. Chances are good that the majority of Whole Foods customers are already Amazon Prime members too. How much overlap exists between Bonobos and Walmart, and will the association with Walmart chase away Bonobos’s most loyal consumers?

celeste@pebblepost.com
celeste@pebblepost.com
  Dick Seesel
6 years ago

Couldn’t agree more. These two brands have zero affinities. What job does the Walmart customer get done at Bonobos? I don’t see the fit from the customer’s point of view. This may be a case of Walmart buying tech expertise which makes sense, but at what cost to the Bonobos brand and its own existing customers?

Dave Bruno
Dave Bruno
6 years ago

This is a very interesting discussion. I have yet to discern a well-defined vision behind these niche brand pickups by Walmart. Certainly Moosejaw, ModCloth and Bonobos all have appeal to younger, more upscale shoppers, as mentioned in the article, and these businesses will certainly help Walmart gain more insights into these shoppers. Beyond that, it feels like a real uphill climb for Walmart to “shed their skin” as a low-price brand and prevent that reputation from impacting these other brands. Time will tell, of course, but I wonder if it’s possible that this move is as much a reaction to Amazon’s recent expansion into apparel via eight private label brands as it is a proactive strategic ploy.

Art Suriano
Art Suriano
6 years ago

We see an aggressive war between Walmart and Amazon. Amazon attempting to gain more ground in brick-and-mortar and their announcement Friday to purchase Whole Foods is another move in that direction. Walmart purchasing Jet and now Bonobos is focusing heavily on e-commerce and attempting to compete every way they can compete, mainly with Amazon. The result will be two companies who will reinvent both e-commerce and brick-and-mortar business, blending the best of technology through its conveniences and services along with in-store shopping. Ten years from now we will look back to this period as the point when it all started.

Max Goldberg
Max Goldberg
6 years ago

Walmart and Amazon are in the ultimate retail arms race. Since Walmart can’t seem to create home-grown e-commerce, it has turned to acquisitions. From these acquired brands, look for the company to broaden its reach and effectiveness. Walmart wants the 90 percent of Americans that visit its stores each month to also shop online. Amazon wants to extend its 41 percent share of e-commerce into brick-and-mortar. It’s going to be an interesting battle.

Charles Dimov
Charles Dimov
6 years ago

Walmart is building an omnichannel retail empire from the brick-and-mortar side, expanding into online step-by-step. Online they are stepping into higher-end fashion. This all seems like the Honda model in the ’70s and ’80s. They started as a low-end car in the market and revolutionized their brand into a mid-range premium brand that stands for quality. Could Walmart be doing the same?

The opportunity is that customers can now buy the same great quality goods, but use their broad footprint for in-store pickups letting customers try on their purchases. Will there be brand confusion, as a risk? Yes, at the beginning, there might be. Over time, as long as Walmart lets the strong brands they purchases flourish at an arm’s length then there is a chance this won’t trouble them in the mid-longer term. It all depends on the management approach. Watching with interest!

Jon Polin
Jon Polin
6 years ago

Walmart has its claws deeply into a specific consumer segment. They only have one way to go in expanding their base — more upmarket. Acquisitions like Bonobos certainly enable this. The challenge will be in integrating several new brands — Bonobos, ModCloth, Moosejaw and Shoebuy — quickly but logically. I think Marc Lore and Andy Dunn can pull it off.

Bill Hanifin
Bill Hanifin
6 years ago

I agree with the others who have commented so far that the brands are not complementary. Bonobos are high quality products that are sold with a high level of custom care. They are also pricey. Therefore the advantage Walmart seeks to create through this acquisition is not immediately clear.

As stated in the lead article, “the main benefit of adding niche brands such as Bonobos is to gain a better reach and understanding of younger, urban and more upscale consumers.” If that means the play is for customer data and segment intelligence, $310 million is an expensive price tag for customer data.

If Bonobos will become part of the Jet group and therefore not associated directly with the Walmart brand in the marketplace, then Walmart would appear to be continuing on its path to aggregate fashion brands into a separate portfolio. Creating a wholly separate business that just happens to be under the Walmart umbrella makes the most sense.

Ryan Mathews
Ryan Mathews
6 years ago

So … here’s a thought for all those that might think this is an odd acquisition, maybe Walmart has caught on to the obvious — its traditional core customer is an endangered species. They aren’t extinct yet, but they will be in a decade or two. Forget omnichannel — a word that makes me break out in hives every time I type it. Walmart is in the process of exploring ways to transfer its brand promise, equity and values to a digitally native market and I say good for them. Ten or 15 years from now — assuming they survive, and that may be a bullish position — today’s “niche direct” brands will be the Walmart brand. Times are changing. Consumers are changing. The only thing, in fact, that isn’t changing are traditional retailers. Walmart deserves some credit for understanding those Boomers and Gen Xers looking for a $3 tee shirt aren’t going to be around forever. Times moves on and so, so it seems, does Walmart.

Brandon Rael
Brandon Rael
6 years ago

From an e-commerce branding perspective, the Walmart acquisition of Bonobos further expands their reach and competitive edge in the e-commerce world. However, Walmart would be wise to enable Bonobos to continue to run their operations as they stand, as Bonobos has a well established yet evolving business model with their innovative guide shops and outstanding customer experience. The model has significant advantages, as Bonobos saves on inventory costs and real estate.

The strategy will continue to work well if Bonobos continues as an autonomous business. They have a very loyal Millennial and Generation Z following who do not necessarily align with the traditional Walmart customer. However, with the power of Walmart’s technology, resources, capital and infrastructure, Bonobos will have the ammunition to continue to be pioneers in the digital native e-commerce businesses, helping to bridge the gap between the physical and digital with their multi-sensory guide shops.

Peter Charness
Peter Charness
6 years ago

I can’t think of a match with less in common than Bonobos and Walmart (OK they both sell apparel). I suspect Bonobos has more of a core competency in digital and more of an interesting business model than does Walmart, but I frankly don’t see much applicability of one to the other.

Verlin Youd
Verlin Youd
  Peter Charness
6 years ago

Peter, maybe you’ve nailed it on the head. They may be buying to get additional digital competency, business model innovation, and incremental customers.

Phil Rubin
Phil Rubin
6 years ago

Three thoughts on Walmart buying Bonobos, especially contrasted against Amazon’s purchase of Whole Foods Market.

  1. If you consider Amazon’s now 20-year obsession with customers and Walmart’s lengthier obsession with low prices and size, it’s hard to relate to what Walmart is trying to achieve if it has anything to do with either Walmart’s or Bonobos’ customers.
  2. As a fairly loyal Bonobos customer and someone who only shops Walmart to pay attention to what’s going on there, this deal is a turn off. As someone who devotes his professional life to customer marketing, it’s equally a turnoff.
  3. Walmart’s core acquisition — i.e., Jet.com — was smart given Amazon’s lead over Walmart in digital commerce. This deal might buy Walmart some talent, but it’s not going to be overly accretive nor is it going to be explicitly synergistic. Again, contrast this to Amazon and Whole Foods sharing a core customer base of more affluent customers, a commitment to those customers and commitments to making the world better and it’s difficult to see Walmart with a brilliant grand strategy here.
  4. Beyond Andy Dunn’s implied interest in working with Jet.com’s Marc Lore, which could be quite palpable, it’s hard to see other Bonobos employees being terribly excited about working for Walmart. By contrast, there is tremendous enthusiasm at Whole Foods about working with Amazon.

If I ran a long/short hedge fund this would lead me to (remain) being long Amazon and short Walmart.

Lee Peterson
Lee Peterson
6 years ago

To me, this is all about understanding how showroom stores work. Think: if you didn’t have to have huge inventory levels, you could have smaller customer space, and if you had smaller customer space, you would have more space to turn the rest of your store into a fulfillment center. Whether it’s BOPIS or ship to home, stores will become half fulfillment, half experience, and this is one leaping step towards that end.

The fashion element here is an ancillary benefit.

Verlin Youd
Verlin Youd
6 years ago

Makes total sense to me. Walmart has to continue to be relevant to the current as well as target markets and this kind of acquisition seems to meet the qualities of a good acquisition; strong management, strong brand, strong operating model, complimentary competencies, complimentary customers along with a bit of overlap, and likely earnings positive. If Walmart is going to remain competitive, let alone relevant in the future, they must be making moves like this. Interested to see their next moves too.

Ricardo Belmar
Ricardo Belmar
6 years ago

There are many interesting discussion points with this acquisition by Walmart. It’s hard to find an immediate synergy between Walmart and Bonobos. Unlike Amazon and Whole Foods where there is likely plenty of overlap with Amazon Prime customers, it’s unlikely the apparel shopper that buys Bonobos is also shopping for similar product at Walmart. Walmart’s approach to these acquisitions seems to be to build out a portfolio of higher-end brands to focus on e-commerce with a slight nod (but not focus) to brick and mortar sales. Walmart is looking to grow its customer base and in one way this is acknowledging that everyday low price can only bring them so many customers. They want to grow into higher-end, potentially higher-margin categories, and the existing Walmart brand isn’t likely to credibly attract those customers.

The risk is more with Bonobos and the other brands they’ve acquired. Will their existing customers be turned away due to fears of Walmart altering their favorite brand? Only time will tell.

William Passodelis
William Passodelis
6 years ago

Watching the back and forth fight and competition of these two behemoths (Walmart and Amazon), ongoing, seemingly independent and without thought or concern for other competitors (i.e. in relation to the complete and unfortunate lack of relevance of potential competitors), focused only on one another and both understanding need to get to where they each need or want to be…. I continue to be fascinated and mesmerized!

This is not a surprise to me at all. Lack of similarity between WM and Bonobos is fine, actually even beneficial. WMT can learn from the Bonobos customer, but more importantly — look at the blossoming empire being constructed!

Jet.com
Then, sports: MooseJaw
Shoes: ShoeBuy
Womens: ModCloth
and now…
Mens: Bonobos

Walmart already has grocery and continues to get better at Walmart online, the construction of an entire (department) e-commerce world that can fulfill whatever is neededIt is brilliant and not done yet, but starting to, or actually very much taking shape into the wonderful potential platform that Walmart may have online!

I have no doubt that rooms of strategists at Amazon are daily digesting and evaluating the possibility that Walmart is building towards. If I were Walmart, I might try and get a spy into Amazon to try and discover benefits that Amazon may be afraid of that perhaps Walmart online division had not thought of….

The ability to build and integrate these pieces will be a large task for Mr. Lore. But I think he is up for the challenge and while I respect and admire the incredible ability and smarts of Mr. Bezos, I am glad for if nothing else, good old fashioned capitalist competition, that there is one player with the ability and wherewithal to go full steam ahead and attack in its own right! The next decade is going to be incredible!

(Personally, as a former Kroger guy I just hope Kroger can maneuver and survive — and hopefully somehow prosper in the change, and possible craziness, to come!)

Thank you all!

Alex Senn
Alex Senn
6 years ago

Yes, this acquisition has a few points about it which don’t exactly line up. Who knows how it will actually end up, but if Walmart looks to include Bonobos shops within a classic Walmart, I’m not so sure this will cut it with consumer expectations at both companies, nor does the Bonobos model support this. However, if Walmart were smart they could combine their new successful digital native brands into a new store format all it’s own already popular with younger, more affluent shoppers.

The problem is Walmart has so much brand equity wrapped around low prices, which inherently means low quality to any educated Bonobos-esque customer. Now if Walmart integrates the two companies, this would open up a large data set to Walmart of upper-middle class Millennials. Walmart could use this to personalize the product set shown to these customers. Essentially this would come down to understanding the higher income level needs of this type of consumer and make them understand that Walmart has a high value, high-quality line as well, which they should consider in their purchase decision.

It’s a tough sell, nonetheless it will be interesting to watch play out.