Tuesday, 14 July 2009

Bonprix's US reentry

The acquisition by Otto Group’s Bonprix division of US women's fashion manufacturer/marketer Venus Swimwear makes a certain amount of sense. The largest global direct seller, Otto’s presence in the largest global market is limited to its ownership of home furnishings cataloguer/retailer Crate & Barrel and its CB2 spin-off. And because Otto bought Venus out of receivership--which it fell into in May after its primary lender unexpectedly pulled its financing—it no doubt managed to strike a good bargain.

What doesn’t make sense, though, is that Bonprix, and not another Otto unit, is the buyer. As its name suggests, Bonprix is a value brand. On its UK website you can buy a women’s swimsuit for as little as £4.90, although most fall in the £10-£20 range. On the Venus website, most of the one-piece suits cost $69-$89 (£42-£55), and the brand’s emphasis was always on being fashion-forward, with an especial appeal to younger women. In terms of branding, I’d think that other Otto titles, such as Apart or 3 Suisses, would be a better fit with Venus.

Perhaps Otto thinks that it can use Venus as a platform to relaunch Bonprix in the States. Bonprix had mailed a catalogue in the late 1990s-early 2000s, but it never caught on in the US. Now that the recession shows little signs of relenting in the States, Otto may have decided that now is a better time to introduce a value brand there. The acquisition of Venus, then, would be less a matter of brand synergies and more an instance of back-end synergies.--SC

No comments:

Post a Comment