Wednesday, May 22, 2019

Zalando enjoys fruits of sustained self-investment


Zalando has reiterated its commitment to investing in infrastructure, relationships and customer proposition development on the back of a successful financial year.

The clothing etailer saw a 33.6% increase year-on-year in revenue in 2015, above its medium-term target of 20-25%. To ensure growth in the immediate term, the company said it would continue “to invest in its customer proposition.”

“Our market position has never been stronger, and we have never faced so many great opportunities,” said Rubin Ritter, a member of the Zalando Management. “We want to excite even more customers and gain further market share. We deliberately pursue growth while maintaining solid profitability – we think this is the best way to create long term value.”

The period saw continued investment in mobile and app development. Zalando has long emphasised the importance of technology for its development. Speaking to Retail Gazette last year, Senior Vice President of Operations David Schroder said “having a great mobile sight and great apps is an absolute necessity.”

The year saw mobile traffic increased 60% year-on-year, and app downloads increased to 19m, from just 7m in 2014. Active customers were also attracted by improved relationships and joint campaigns with local brand partners. By the end of the year, the number of active customers had risen by 22% from the previous year to almost 18m.

Infrastructure, too, was a key factor this year. Zalando opened tech hubs in Dublin and Helsinki and raised its employee headcount to 1,000. There are also plans to expand Zalando‘s fulfilment capabilities with a third large fulfilment centre in Germany, and a satellite warehouse in Italy. Plans for another large hub are currently in motion.