US: Walmart Confirms ModCloth Acquisition

Walmart has announced that it is acquiring online fashion brand ModCloth, confirming reports that emerged last week.

The deal covers the assets and operations of ModCloth, and was completed on 17 March 2017. The ModCloth team will continue to operate its website and one store (in Austin, Texas) as a “standalone and complementary brand” to Walmart’s other e-commece sites.  Walmart added that ModCloth CEO Matthew Kaness, the executive team, and the 300+ employees will continue to be based in San Francisco, Los Angeles and Pittsburgh.

The retail giant said the deal will help expand its US e-commerce efforts “and will further strengthen the collective capabilities of the overall team”.  It also noted that designers who currently sell via ModCloth will now also have the opportunity of listing their products on Jet.com and other Walmart e-commerce sites.

NAM Implications:
  • In other words, a step closer to selling anything that can be legally sold to consumers..
  • …online, where space is not an issue, or a cost…
  • …and Amazon unlikely to sit on the sidelines…
  • This 6-month acceleration of online acquisitions has to change the online competitive landscape…
  • Time for competitors and their suppliers to acknowledge the change…and act accordingly?