Nordstrom and Asos are teaming up in a bid to revive the fortunes of a faded fast fashion brand.
The American department store chain has acquired a minority stake in Topshop and three of its sister brands, which Asos bought out of administration in February, the companies said Sunday. The move paves the way for a wider strategic partnership, the retailers said.
The financial terms of the deal were not disclosed. Asos spent £295 million ($410 million) to acquire Topshop, Topman, Miss Selfridge and HIIT in February.
The deal reflects a wider reshuffle taking place across the retail spectrum, since the pandemic accelerated a shift to online shopping. Brick-and-mortar players scrambled to build out their e-commerce offerings, while digital-first players have taken advantage of the shake out to snap up well-established but financially unstable brands.
But the partnership between Asos and Nordstrom could signal a new chapter as fashion’s biggest retailers seek out strategic alliances to build an edge in the market.
British online retailer Asos has performed well during the pandemic, benefitting from the closure of physical stores. But it faces fierce competition from rivals like Boohoo Group and Zalando and has long-standing ambitions to expand in the US.
Meanwhile, Nordstrom is regrouping after a challenging year. Lockdowns in the US last year hurt sales and its recovery has been uneven. The company reported a net loss of $166 million in the quarter ended May 1.
A tie up between Asos and Nordstrom could help solve issues for both companies. Asos has strong penetration with a covetable young customer base –— and the powerful Topshop brand. Nordstrom has a ready network of stores in the US. While Asos has said physical retail is not its model, there are definite benefits to gaining access to storefronts.
The partnership will build on existing ties. Nordstrom has been the exclusive retailer of Topshop and Topman in the US since 2012 and will gain exclusive multi-channel retail rights for the two brands for all of North America. It will be the only brick-and-mortar presence for the brands globally.
Longer term, the plan is for collaboration beyond the Topshop brands. Down the line, Asos and Nordstrom said they are in discussions to create a multi-channel showcase for some Asos brands, targeting the department store chain’s customers. E-commerce orders made through Asos will be available for pick up in Nordstrom and Nordstrom Rack stores from this fall.