Zalando explains its strategy for Italy

Zalando debuted on 9 April in Milan with a pop-up store on the Via Vigevano in Navigli. This is the first time the German e-retailer took to the streets, face-to-face with customers.“A few months ago a pop-up store was opened in Berlin, when we

launched our private label Zalando, but only clothes in that line were being sold,” explained Giuseppe Tamola, country manager of Zalando Italy, in an interview with FashionUnited.

TheZalando explains its strategy for Italy Milan space is much broader in scope, currently selling items for Spring and Summer 2013 of the Zalando Collection, Benetton, Cheap Monday, Donna Karan, Diesel, French Connection, Guess, mint&berry, Marc Jacobs and Patrizia Pepe among others. The store was open until 14 April and a similar initiative will be repeated in Rome, where the company is currently looking for a suitable location.

“Rome is the Italian city where we are strongest, Milan is second,” added Tamola. Judging by the high turnout of customers over the three days in Milan, it would seem that the fashion capital is seriously challenging Rome’s primacy. The buzz could definitely be felt during the hour and a half that FashionUnited was inside the store during the interview; Zalando’s pop-up store seemed to attract many more customers than the boutiques in the traditional shopping areas around Via Montenapoleone and Via della Spiga. “Yesterday we opened at 11 and made the first sale after only five minutes”, confirmed Tamola.


Zalando is the most clicked brand on Google.it

This is not surprising: Zalando was the most clicked fashion brand on Google Italy in 2012. Germany, Austria, the Netherlands, France, Italy, UK, Switzerland, Sweden, Belgium, Spain, Denmark, Finland, Poland and Norway are the other country-specific sites where Zalando is dedicated to selling shoes, clothes and accessories.

But how did the German company founded in 2008 by Robert Gentz and David Schneider manage to get so well known in the Italian market? “We implemented an ad hoc strategy, based on actions online and offline. I am referring to our television campaign, the work on social media, 500 partnerships with brands such as L'Oreal and Kellogg's, an internet shopping booklet in newspapers and the print magazine we published in Italian”, explained the country manager, adding that the temporary store is clearly part of a strategy that led 600.000 Italian customers to the e-commerce site. “We have about 150 Italian brands and more than 1,500 international brands”.

To-date, the Italian market is among those with the greatest potential. “Italian customers are much less accustomed to buying online than Polish, Greek or Spanish ones. In our country, the percentage of people who buy online reaches only 20 percent, compared to 70-75 percent in Northern Europe”. Perhaps this is why 50 percent of the company’s turnover in 2012 - equivalent to 1.15 billion euros (compared to 510 million euros in 2011) - was generated in Austria, Germany and Switzerland and the remaining 50 percent in the rest of Europe.

Here’s a strange but true fact: Before landing in Italy, the management had to convince founder and managing director Robert Gentz to restore the payment-on-delivery payment option. “In Germany, it disappeared about 20 years ago”, said Tamola, pointing out that this is currently the favourite payment method (usually in cash) of Italian clients, followed by credit card or PayPal payments.

But who is the average ‘made-in-Italy label’ customer and what is Zalando’s strategy for taking over yet more of the market share? “Our typical client is between 25 and 45 years old, often a woman, although it must be said that in Italy, men also shop and are fashion-conscious, much more than in other countries”, affirmed Tamola, explaining that the optimisation of logistics and customer service are among the mechanisms to invest in for further growth. “For example, ensuring that the call centre answers after only a few seconds,” added Tamola.

Not only that: evaluating the online budget weekly is also high on the list to perfectly calibrate investments and thus optimise every euro spent. The customer satisfaction model to follow is that of pharmacies. “It’s a good model; pharmacies have the highest level of customer satisfaction. The ideal situation is to be super competitive on processes and have a firm understanding of the product,” explained Tamola.


Who are Zalando’s Italian customers?

Zalando has considered four of the most significant cities for the Italian market: Rome, Milan, Florence and Palermo. Analysing purchasing habits in 2012 showed that Rome and Milan are the cities with the largest number of customers, that Florence the most eclectic city in terms of brand choice, while Palermo customers buy most sporting goods.

So who buys the largest percentage of premium items? The answer would be customers in Milan (at 1.5 percent of items purchased), whose average expenditure per article is also the highest, albeit only slightly higher than of customers in Rome. In Florence and Palermo, customers are proving to be more eclectic in their choices, with an average of 14 and 12 different brands per customer, respectively. Palermo is the city where most sunglasses and flip-flops are sold, while Rome - and no one would have imagined this - is where most rain boots are purchased. Lastly, most articles for children are bought in Florence (9.4 percent of items purchased), followed by Palermo (9 percent).

Overall, Zalando’s future in Italy seems bright and the brand is looking forward to an equally good experience with its first pop-up store in Rome.

Image: Zalando’s pop-up store in Milan
 

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