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Bonobos: Digital Economy in the Fashion Retail Sector


  1. Introduction.
  2. Company’s Current Digital Initiatives
    1. Initiative 1: Developing Strategic Design
    2. Initiative 2: Focusing on Small but Strong Aspects
    3. Initiative 3: Affecting Customer Service
    4. Initiative 4: Using Stores as a Means of Interaction
  3. The Financial Impact of Online Strategies Adopted
  4. Recommendations.
  5. Conclusion.


Fashion retail is one of the most popular business sectors in the modern era, and actors in this sector need to recognise how market strategies are rapidly changing in order to be profitable. E-commerce is among the highly successful approaches in the fashion industry since with its help, companies can involve more customers and have more advertising opportunities. However, not all digital economy initiatives are productive and not all firms can boast having earned their clients’ trust and loyalty through such strategies.

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Bonobos, which was founded in 2007 as an online-based fashion retail company, has gained remarkable success in the digital economy. This paper will discuss the organisation’s digital initiatives and their success, and the financial effect of the online strategies the company has adopted. Also, recommendations for the company’s future activities will be made.

Company’s Current Digital Initiatives

The company in question, Bonobos, was founded in 2007 in New York. This organisation is considered to be “the largest clothing brand ever built on the web” (Shaping the future of retail 2017). Bonobos creates and sells men’s clothes that are trendy and comfortable. The digital initiatives of Bonobos are disrupting the market for menswear by offering high-engagement in-store shopping opportunities along with a high-quality e-commerce presence (Shaping the future of retail 2017). Among the company’s digital initiatives, a convenient returns policy and free shipping stand out (Forbes 2017). As Bonobos was founded as an online-only retailer, it is well aware of online marketing strategies and the ways of making the most of them.

Initiative 1: Developing Strategic Design

Currently, there are four digital initiatives employed by the company which are highly successful. As Mroz (2017) remarks, it is not enough to have great products and ideas to be competitive in the e-commerce market. The first of Bonobos’s successful digital initiatives is the strategic design of each product’s page (Mroz 2017). On the company’s website, the page for every product offered to clients has an elegant design in both the mobile and desktop versions. Since as much as 45% of e-commerce traffic comes from mobile phones, Bonobos made it a priority to create mobile-friendly pages for its clothes (Mroz 2017).

For every product, high-resolution photographs are available, so it is easy to switch between colours. Another advantage of Bonobos’s website design is that there is an easily accessible help desk. Finally, a significant feature affecting customers’ decisions is the possibility of entering billing and shipping data on the same page. This option is rather convenient and buyers are unlikely to leave the page, as they often do when there are too many pages to fill in when making an online purchase.

Initiative 2: Focusing on Small but Strong Aspects

The second initiative that has promoted Bonobos’s success is focusing on strengths, even if they are few. The main idea is that a company should realise what it does best and develop in that direction. For Bonobos, back in 2007, the path began with the unique concept of creating a comfortable waistline in men’s pants (Mroz 2017). At present, the company produces various types of men’s clothing, such as ties, shirts, jackets, and shoes.

However, if it had tried to make all of these items at the outset, it could easily have lost its focus and failed (Mroz 2017). Thus simplicity is not bad, and it can even be quite advantageous. Moreover, this approach is beneficial for developing both product and customer loyalty. Once a company has a solid knowledge of its customer base and gains their trust, it will be easier to advertise new products.

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Initiative 3: Affecting Customer Service

Another successful digital strategy initiated by Bonobos is providing excellent customer service by adopting a completely new philosophy rather than taking one of the typical approaches, which often annoy customers. If customers have an issue with a product purchased from Bonobos, they do not have to call a contact centre that holds the line or whose agents know nothing about the product in question.

Instead, Bonobos has created an opportunity for their customers to contact support via email, phone, or online chat (Mraz 2017). All employees of the company’s customer service are highly knowledgeable and always ready to handle clients’ problems. Bonobos calls people working in this department “ninjas” because they can solve any issue very quickly and professionally. The company’s secret is that it treats its customer service as a business investment instead of viewing it as an operational expense. As a result, positive experiences with specialists from this department motivate clients to continue and increase cooperation with Bonobos.

Initiative 4: Using Stores as a Means of Interaction

The fourth successful digital strategy developed by Bonobos consists of making its stores places where customers can discover products. Unlike traditional companies, which start with physical stores and then develop online options. Bonobos’s primary environment was the online market, but the retailer then realised that it needed to expand with the help of physical stores (Mroz 2017). Thus in 2012, the company opened its first Guideshop where buyers have the opportunity to see the clothes in person rather than through a screen. Such Guideshops serve as a quiet service hub where clients can try on things, return or buy them, and have them shipped to their homes. Every visitor is met by a staff member who spends 45 minutes on average listening to customers’ preferences and satisfying their needs (Shaping the future of retail 2017).

There are lounge areas in Guideshops where customers can enjoy a free refreshing drink. The strategy allows for minimising return rates along with increasing people’s interest in the company’s products. This initiative is especially crucial in the context of contemporary commerce, with many retailers starting their business online and then seeking to enhance their commercial opportunities.

The Financial Impact of Online Strategies Adopted

The digital initiatives employed by Bonobos have gained the company a high level of customer loyalty, success and profit. The financial effects of its online strategies allowed Bonobos to attain high annual growth rates. In particular, the company’s annual revenue growth for 2015 was nearly $100 million (Forbes 2017). In 2016, Bonobos had $128 million in funding, and it employed over 300 people (Parr 2016). Since its founding, the company has only increased its profits without experiencing financial losses.

The story of Bonobos’s success is truly impressive. After starting with only $401,000 in 2007, the fashion retailer raised $24 million by the end of 2010 (Parr 2016). The highest growth in revenue occurred in 2012, when Bonobos opened its first Guideshop. That year, its revenue was $16.4 million in Series B. In 2013, Bonobos raised $30 million in their Series C, which brought total funding to $73 million (Parr 2016). In 2014, Series D raised $55 million, with one of the reasons for this profit being the opening of more Guideshops. The company’s founder and CEO, Andy Dunn, regards his digital initiatives as the major driver of financial success (Parr 2016).

Data from SimilarWeb, a website analysing traffic statistics, indicate that Bonobos has a solid base of loyal clients ( December 2018 overview n.d.). Such a high level of devotion can be explained by the company’s careful analysis of customers’ needs and delivery of high-level services.

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For Bonobos to sustain and increase its current success rate, several recommendations could be made. First of all, since the Guideshops initiative has proved to be so profitable, it is necessary to open more of these hubs. However, it is essential to do so by taking small steps, just as Bonobos did previously. Being cautious is an effective strategy, and this approach should not be neglected. Another recommendation is more time- and money-consuming, but it seems to hold great potential. It is likely time for the company to think about creating women’s clothes as well. Prior to launching such an initiative, it will be necessary to weigh all the pros and cons of this strategy. Bonobos would clearly need to start with one item, just as it did in 2007 with men’s clothes.


The rise of the digital economy has created numerous opportunities for businesses to advertise their products and reach out to potential customers. However, not all companies use these possibilities successfully, and many tempting but risky initiatives are undertaken. Bonobos is an example of excellent implementation of digital initiatives for increasing profitability and customer loyalty. Low prices and a large range of products are insufficient to attract and retain modern customers. Bonobos shows that only thorough and gradual development and application of online strategies can help companies to attain success in the fashion retail market.

Reference List December 2018 overview n.d. Web.

Forbes 2017, ‘How Bonobos fits at Wal-Mart’.

Mroz, B 2017, ‘Four digital commerce lessons from fashion retailer Bonobos’, Econsultancy. Web.

Shaping the future of retail for consumer industries 2017.

Parr, S 2016, ‘How the Bonobos founder went from “insufficient ATM funds” to over $100 million in revenue’, The Hustle.

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