Wal-Mart scoops up men's clothing company Bonobos for $310 million

Posted June 18, 2017

Bonobos founder and CEO Andy Dunn will report to Lore, and Bonobos could still stay a separate brand from Walmart-not necessarily sold in Walmart stores or even on Walmart.com.

Amazon's bet on the organic grocer will help the company better compete against Walmart-which is now the leading grocer -beating out competitors like Safeway (SWY) and Kroger (KR)-according to a 2015 Consumer Report that says the retailer captures about 25% of the grocery market in the US, up from around 7% in 2002.

What do all of these names, plus Bonobos and Jet.com, which it acquired last August for $3 billion, have in common?

For Walmart, the deal marks at least its fourth acquisition of a digital-first retailer since Marc Lore took over as head of e-commerce in the US last fall - others have included Modcloth and ShoeBuy.

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The strategy is beginning to take hold: Last quarter, Walmart's US e-commerce sales grew by 63%, although most of that growth came from Walmart's flagship website.

Big Picture: Walmart has been expanding its online offerings to keep up with Amazon.com, buying clothing company Bonobos on Friday.

"We're seeing momentum in the business", Lore said in Friday's statement.

"We believe that with Walmart's scale, we'll be able to create efficiencies and an evolved shopping experience that benefits you, our customers".

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"Adding innovators like Andy will continue to help us shape the future of Walmart", said Lore.

Along with potentially ushering new customers into the Walmart fold, the new sites provide deep wells of expertise about products ranging from shoes to apparel, and Walmart has kept the sites' management teams and staffs intact. "We are excited about applying all that we have learned to help shepherd in the next era of retail". Founded online in 2007, Bonobos has expanded its assortment over the years and has also opened 35 brick-and-mortar stores ("Guideshops"). "In fact, Andy will be a great influence on the company, especially in leading our collection of exclusive brands offered online". Walmart has focused on brands appealing to younger shoppers.

The company has 30 stores where customers can be custom measured for their clothes, and also mini-stores at Nordstrom. But the new numbers that Wal-Mart is delivering in the digital space aren't just thanks to Jet or its widely heralded pricing algorithm.

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