Walmart sells ModCloth just two years after buying it

Walmart is selling the women's clothing company and online retailer ModCloth, just two years after acquiring it. The brand will now be part of the investment firm Go Global Retail, although it will continue to operate independently.

"We expect them to continue in the same direction as before," said Christian Feuer, managing director of Go Global Retail. The Verge . "I don't think the customer sees a change. If they do, I hope they are happy with what they see."

Susan Gregg Koger started ModCloth in 2002 as an independent online fashion retailer. He was known for choosing real people as models and for being one of the first clothing brands to take the No-Photoshop commitment.

When the company sold to Walmart in March 2017, many customers felt betrayed. "What I loved about ModCloth is that I knew that the clothes I bought there couldn't be found at Macy's and that the masses didn't use it," said Connie Warner The Los Angeles Times . Warner started a Facebook page of Boycott ModCloth to protest against new store owners. "No more. I have unsubscribed from your emails. I refuse to buy from a Walmart-owned store."

walmart sells modcloth just two years after buying it

A screenshot of the ModCloth shopping interface.

For Walmart, the agreement was part of a broader strategy to increase its e-commerce business in an effort to compete with Amazonas. "When we acquired ModCloth, our main focus was to build assortment through patented, digitally native brands," said a spokesman for Walmart The Verge. “Our approach has evolved and our current approach is to build direct brands for the consumer that we can take advantage of in an omnidirectional way. Similar to the online grocery store, we are investing in areas where our omni capabilities and unique advantages put us in a position to win. ”

In case you haven't followed the “omni” jargon, Walmart is trying to focus on products that work well in stores and online. And that makes sense: Walmart has sunk billions trying to compete with Amazon. While some of that money has been worthwhile (online sales increased 40 percent last year in the United States), the e-commerce division projects losses of more than $ 1 billion this year.

Hours after the ModCloth agreement was announced, The Wall Street Journal reported that Walmart was also looking to sell its personal brand of Jetblack shopping. The boutique service allows customers to buy by text message and receive their items in a matter of hours, but was losing a lot of money. "Earlier this summer, Jetblack was losing about $ 15,000 per member annually," wrote The Wall Street Journal

. While Feuer plans to grow the brand in the US. UU. And abroad, he wants him to stay true to his roots. "We are all focused on ModCloth being a specialized retailer with a specific orientation towards women's fashion," he said.

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