Walmart has been on a tear of late, buying e-commerce startups and emerging brands that used the internet to grow.
Bonobos would represent Walmart’s latest attempt to build its cachet online.
The company acquired Jet.com for $3.3 billion last year in a deal that transformed Walmart’s web operations and brought in a fresh team of e-commerce executives including Marc Lore.
It followed that by snapping up smaller sites, including outdoor retailer Moosejaw and women’s apparel seller ModCloth, earlier this year.
Founded in 2007, Bonobos started by selling dress pants to men and quickly expanded its repertoire to shorts and colorful plaid shirts.
While the brand started as an online-only retailer, Chief Executive Officer Andy Dunn has in recent years started to incorporate brick-and-mortar stores into its strategy.
Some loyal Bonobos fans are deeply disturbed by the news.
Customers have expressed their dismay on social media, calling the potential acquisition “brand suicide” and threatening to never shop at Bonobos again if it's acquired by Walmart.
“Bonobos just lost a customer,” one person wrote on Twitter. “I do love the stretched washed chinos but no offense, I won't go to Walmart for my clothing.”
These shoppers' visceral reactions to the news might have something to do with there being little overlap in the customers of Bonobos and those of Walmart.
Bonobos sells slim-fitting casual and work clothing for men online at a price point of about $100 an item or up to $1,000 for a suit.
The company markets itself to hip, young, urban, fashion-conscious men.
The price range for Walmart's menswear, which appeals to a much broader audience, is closer to $10 to $30.
That stark contrast is exactly why the move would make strategic sense for Walmart, according to Oliver Chen, an analyst at Cowen & Co.
For Walmart, Bonobos offers “a brand with loyal customers, premium price points, and expertise in a differentiated niche,” as well as fresh merchandising and fashion talent, Chen wrote in a research note on Monday.
It gives Walmart an opportunity to enter a high-margin specialty category that would help it better compete with Amazon, Chen said.
Related: Walmart’s E-Commerce Future under Marc Lore Starting to Come Together
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