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Can Boohoo Overcome Nasty Gal’s Mistakes?

If it plays its cards right, Boohoo could accelerate its American ambitions and learn from Nasty Gal’s success in brand and online community building.
Source: Nasty Gal
  • BoF Team

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This week, Nasty Gal, the Los Angeles-based, venture-backed fashion retailer that filed for Chapter 11 bankruptcy protection in November, announced it has been acquired by Manchester-based fast fashion e-tailer Boohoo, confirming a previous report by BoF. Boohoo is said to be buying Nasty Gal, once valued at more than $200 million, for a mere $20 million and will gain the ultra-trendy label’s intellectual property and customer data, among other assets. But will Boohoo be able to effectively exploit its new purchase and overcome the legacy of Nasty Gal’s past mistakes?

Nasty Gal, which began as an Ebay store, quickly grew into a business generating more than $100 million a year in sales, largely on the back of a close, social media-driven relationship with its community of “badass” girls who identified with the company’s sexpot-hipster attitude. But the label lost some of this core base when it raised prices too high in a failed repositioning. Meanwhile, the product offering itself was easy to copy and competitors ranging from upstarts like Boohoo to established players like Forever 21 and Urban Outfitters began eating into Nasty Gal’s market share.

At the same time, Nasty Gal founder Sophia Amoruso emerged as a brand of her own. Her cheeky, self-help business memoir — #GirlBoss — grew into a movement, but its relationship to the Nasty Gal label became hard to decipher, diluting the power of the brand and creating confusion amongst consumers. What’s more, as #GirlBoss continued to grow, Amoruso’s attention drifted away from the core business and Nasty Gal found itself without a focused leader.

Nonetheless, for Boohoo — which has been trying to crack the US market for years but remains relatively under-penetrated — Nasty Gal’s name recognition in the country could prove a boon and the company could certainly use the brand to accelerate its American ambitions. Boohoo also has much to learn from Nasty Gal’s undisputed success in building a powerful brand and online community. For its part, Boohoo is well positioned to grow Nasty Gal’s global footprint, expanding the label into Europe where it already resonates with consumers.



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Calvin Klein Autumn/Winter 2017 | Source: Instagram/@calvinklein

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