Bonobos “Wizard Shop” in lower Manhattan on April 18, 2017 in New York City.
Bonobos co-founder Andy Dunn is returning to the retailer as a brand consultant as the company looks to walmart Earlier this year, Bonobos and new parent company WHP Global were announced on Friday.
Dunn, who founded the menswear label in 2007, will report to Yehuda Shmidman, WHP’s global chief executive, but will be joined by Bonobos president John Hutchison and courier company CEO Tim Baxter.
WHP Global and Express Inc., which operates the Express brand, bought Bonobos from Walmart for $75 million in a deal announced in April and closed last month. Walmart originally bought Bonobos for $310 million in 2017 as it struggled to expand its online presence under former e-commerce president Marc Lore.
“It’s an almost limitless opportunity, right?” Shmidman told CNBC of the decision to bring Dunn back to the brand. “You’ll have the opportunity to gain insight into why the brand was created in the first place, how successful it was in its first few years and how that happened, and learn from it to inspire the next phase of growth.”
Shmidman said WHP Global had no plans to change Bonobos DNA, and said the company’s decision to appoint Dunn was part of its plan to center the brand’s core identity.
“It’s really important to know that we haven’t changed. In fact, if anything, we’re doubling down on the same DNA that gave Bonobos success,” Shmidman said.
One area Shmidman would really like to see change is Bonobos’ physical footprint: The brand currently operates a brick-and-mortar Guideshop, where customers can try on clothes and then order them online, but only in the U.S. Under WHP Global, Bonobos can say, Expand internationally.
“What about the bonobos in Dubai? How about the bonobos in Hong Kong?” Schmidman said. “How cool would that be?”
Dunn said he was happy to be “sat at the table”, this time just advising the brand – not running it.
“I’m here to provide service in whatever way I’m asked, and I think that’s what it takes to be really close to the customer. I’m a lot older than when Bonobos started, you know, I’m 43 now, I was 28,” said Deng En said. “So, I got a lot of perspective on the product and the customer and how we can start this new chapter and get bigger.”
Bonobos started as a digital-only retailer and grew into a pioneer in the direct-to-consumer space after successfully scaling, becoming profitable and gaining national recognition.
When Walmart decided to acquire the brand, some saw the partnership as moot, as the mega-retailer’s focus on value seemed at odds with Bonobos’ identity as a high-end menswear line.
While Walmart is selling Bonobos at a steep discount to what it paid, the acquisition isn’t necessarily a loss-maker for Walmart. The partnership helps boost its digital sales.
Online sales accounted for about $53.4 billion, or nearly 13%, of Walmart’s total U.S. net sales in the last fiscal year that ended in late January, according to company filings. That’s a jump from 2019’s $15.7 billion, or about 5% of Walmart’s total U.S. net sales.
Andy Dunn, co-founder of Bonobos
Source: Brian McConkie
But how Bonobos is doing under Walmart’s sprawling tent — and what it’s getting — isn’t so black and white.
At the time of the acquisition, Dunn wrote in a blog post The sale to Walmart gives Bonobos access to a wider ecosystem and believes the deal is in line with its goal of “becoming the market leader in all high-end menswear.”
It also gave Dunn the opportunity to work with Lore, his longtime mentor who he considers “the best person in the world at building e-commerce assets for emerging third-party brands.”
The day after that blog post was published six years later, Dunn told CNBC that he stands by his decision to sell the company to Walmart and “strongly” disputes critics’ claims that the brand has been diluted by the acquisition.
“From a premium positioning standpoint, the Bonobos business is still moving to the right,” Dunn said. “From a customer standpoint, I don’t think it’s changed much, you know, my reading is I think the evidence of the continued growth of the brand is in the pudding.”
The Walmart umbrella gives Bonobos access to a broader customer base and protects it from the same pandemic-related headwinds that have plagued other independent retailers during the global health crisis.
“With the pandemic and the tough times in retail, for me, that was a moment where I stepped back and thought, wow, we made the right decision to put Bonobos in such a strong house,” Dunn said. inside.”
Today, Bonobos is still posting double-digit sales growth, WHP Global said.