This story first appeared on Digiday, Glossy’s sister site covering media, marketing and retail.
On Cyber Monday at Bonobos’ New York City headquarters, over 100 staff members from across the company gather in the open-concept space to eat, drink and answer customer phone calls and chat conversations in a holiday shopping tradition the company calls “Ninjapalooza.” Though the company has 30 “Ninjas,” or customer service representatives, on staff, around 70 volunteers from other areas of company pitch in to deal with the seasonal rush. It’s an event that exemplifies the mentality CEO Micky Onvural said is instrumental to maintaining company culture as well as hands-on customer service, while under Walmart ownership.
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“The origins were, ‘scrappy startup.’ Let’s have all hands on palm for the busiest day of the year. It’s evolved to be this moment for us to celebrate the customer, put the customer front and center, and bring that feedback loop even closer,” she said.
Bonobos was launched in 2007 as an online-only menswear company by Andy Dunn. Dunn stepped down as CEO in September and is currently the svp of digital consumer brands at Walmart, which acquired Bonobos last year for a reported $310 million. Onvural, previously Bonobos’ CMO, took over in his place. For Walmart, Bonobos was one step along a path of e-commerce acquisitions it has made in recent years, including marketplace Jet.com, womenswear brand Modcloth and outdoor retailer Moosejaw.
While Walmart’s acquisition tear may yield questions as to whether the e-commerce brands will inevitably be swallowed up by the larger behemoth, Onvural said keeping Bonobos separate from Walmart serves two key objectives. It lets Bonobos benefit from Walmart’s scale and resources, and it allows Walmart to learn about how digitally native brands are built — important lessons as the company grows its own e-commerce business.
“We’re being run as a fully independent organization,” said Onvural. “We’re leveraging Walmart from a buying power perspective on the back end, for things like shipping costs and credit card fees. [For Walmart] the benefit is learning how you build these digitally native brands, as they choose to distribute them through Walmart.com or Walmart stores.”
Through acquisitions like Bonobos, Eloquii, and Modcloth, Walmart can apply lessons to digital-native brands it creates; earlier this year, it rolled out its first online-only brand Allswell, a mattress and bedding line. The company’s push into digital-only brands is part of a strategy to “win the future,” said Dunn in a recent interview. But for any large retailer that acquires “grassroots” e-commerce startups, the approach can be risky if the retailer is seen to be taking too close a hand in steering the acquired company’s plans. If Bonobos is able to maintain its brand equity despite Walmart ownership, that proof-of-concept could help Walmart build a bigger digital brand empire.
From a day-to-day and cultural perspective, Onvural said Bonobos retains its distinct culture of growing employees’ careers from the “Ninja” up, and giving employees the benefit of responding to customers in the best way they see fit without strict rules about how to handle specific situations. Onvural said the personalized approach keeps customers loyal and the brand’s Net Promoter Score high (though she wouldn’t offer a specific number), with the objective to move customer interactions away from transactional questions to an ongoing relationship where customers consult staff members as they would personal stylists. Bonobos products aren’t sold in any Walmart stores or on its e-commerce site, but its products can be found on Jet.com.
“Forty-five percent of our contacts are pre-purchase, with people asking for advice on what they should buy this pair of pants with or what’s the best fit — it’s akin to going to a store and getting advice from a personal shopper,” she said. “We would like to see that volume and percentage increase, and lessen the number of contacts around things like ‘can I change my shipping address or change my payment.'”
Creating remote customer service interactions that resemble going to the store is an ongoing objective. While the company has 58 physical stores and is adding new locations in Salt Lake City later this month and in Tampa and Charlotte next year, Onvural said ensuring an ongoing customer relationship means making sure the company is able to tailor customer interactions based on what it knows about them, including purchase history. It also aggregates site feedback through a Slack channel. Despite the data-driven approach, she said calls aren’t recorded to ensure interactions with customers are authentic.
From Walmart’s perspective, analysts say acquisitions like Bonobos help the legacy retailer get into the mindset of a different type of customer.
“Keeping the brand separate from Walmart is critical because they are two very different customer sets, and each of the brands has a different meaning and value proposition,” said eMarketer e-commerce and retail analyst Andrew Lipsman. “Walmart shoppers are more likely to have time than money, while Bonobos shoppers are more likely to have money than time.”
An important resource for understanding a different type of customer is data on preferences and behaviors. Onvural said as a wholly-owned company, Walmart has access to customer data, though Bonobos doesn’t actively share it with the parent company. She acknowledged that it could be useful for understanding customer behavior at a higher level or from a trends perspective, and that’s why keeping Bonobos’ distinct workflow and employee-customer relationships intact is so crucial to helping the retailer gain a leg up among a younger, more affluent customer set.
“[Through Bonobos] Walmart gains a very unique relationship with non-traditional Walmart customers,” said Jonathan Smalley, CEO of data analytics company Yaguara. “Bonobos gives Walmart a direct relationship from product design, marketing, and conversion. This gives Walmart data on everything from sell-through time, buying cycles, response to messaging, response to digital experiences, and much more.”
Keeping Bonobos’ own distinct culture also keeps employees enthusiastic and loyal. Senior brand marketing associate Colin Canny, who has been with the company for four years and worked his way up from a Ninja, said during the “Ninjapalooza” that a bigger vision around people and growth keeps him tied to the brand and has a follow-on effect on customer relationships.
“When you’re a Ninja, you have time for side projects,” he said, noting that the flexibility to take on other work helped him grow his rank. “They understand that people have aspirations to grow.”
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