Eloquii, plus size for Walmart's online business

Eloquii
09 Oct 2018
In the United States, more than half of women between the ages of 18 and 65 wear size 14 or higher (the equivalent in Italy of size 46 and over), but traditional fashion brands often neglect their needs.

Eloquii is the market leader in plus-size clothing, one of the fastest-growing segments of women's clothing, with an estimated value of $21 billion.

The announcement

Walmart announced the acquisition recently, on its website. Although they did not want to reveal the exact details of the transaction, analysts commonly believe that the deal will close at around $100 million. Walmart is the largest retail company in the world. In 2017 it had a turnover of over 500 billion dollars, with 2,300,000 employees and about 12,000 points of sale. Eloquii was founded in 2011, as part of The Limited, and then relaunched as an independent brand in 2014. Relative to 2015 it recorded a triple increase in turnover, which today stands at around 80 million dollars.

The objective

The acquisition of Eloquii is in line with Walmart's online growth strategy aimed at reinforcing the assortment and category expertise on Jet.com and Walmart.com. The growth in online sales continues to exceed the total market average, and retailers need to focus on upgrading their online platforms to meet growing demand.

Currently, e-commerce accounts for only about 4% of the total revenue of Walmart, which has long been aware of the strategic importance of online business. According to Forbes estimates, the contribution of digital commerce to Walmart's global turnover will be around 6% in the 2021 fiscal year.

The operation is in addition to those carried out in the recent past with other fashion brands. These include ShoeBuy ($70 million), ModCloth ($75 million), and the Bonobos luxury men's fashion site ($310 million). It should be noted that the news does not seem to have pleased all of Eloquii's customers.

The future

Eloquii CEO Mariah Chase and 100 employees will be joining Walmart USA's eCommerce team, reporting to Andy Dunn, senior VP of the company's digital brands. The significance of this acquisition was clearly indicated in Dunn's personal blog: "We are focused on developing a portfolio of consumer-facing brands, with a unique assortment which cannot be found elsewhere".

Also according to Forbes, total eCommerce sales in the United States amounted to $453 billion in 2017 (8.9% of total retail sales) and are expected to reach $526 billion this year (+16% annually), representing 10% of total sales in 2018.

By 2020, total online sales could grow to 12.4% of retail sales and exceed 700 billion. Today, Amazon holds more than 49% of the global volume of US eCommerce.