Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018

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Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
Digital Experience:
   Building 23+
  million Zalando
       shops

Capital Markets Day 2018

        Philipp Erler
        Anne Pascual
       James Healey

         June 5, 2018
Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
Why
    We are building truly
    unique fashion
    experiences to
    democratize fashion

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Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
To achieve impact, we build a modular platform focused on fashion from the very
             beginning benefiting customers, brands and content creators

                     More fashion                             More
                     perspectives                           content

                                        Machine
                                        learning

                     More personal                             More
                     experiences                          flexibility

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Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
We drive substantial impact proven by high A/B frequency testing

      +101%                            +39%                        +40%                     from
                                                                                                    8%
     Conversion rate from
    customers who interact
                                   Basket from customers
                                   who interact with outfits
                                                               Total page views per user
                                                                         (yoy)
                                                                                            to
                                                                                                   20%
           with outfits             vs. those that do not
     vs. those that do not
                                                                                            Zalando’s share of
                                                                                           voice/awareness on
                                                                                              Instagram in DE
          200k                      +17.7%                       +12.5%                        among opinion
                                                                                            leaders/influencers
    Manually created outfits       Time onsite spent per        Revenue per user (yoy)     increased from Feb.
              live                      user (yoy)                                                to April.

4   as at May 2018
Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
Weighted across all devices

    Desktop                Mobile web              Tablet web

        -18.7%                   - 28.8%                - 29.7%

                 -25,4% loading time improvement

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Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
Brands are
    Brands are our
               our strong
                   strong partners
                          partners in
                                   in serving
                                      serving our
                                              our customers
                                                  customers

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Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
Who
    Our customers are all
    unique.
    We understand them:
    hunting & exploring

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Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
Customer journey

                                                   After
    Discover                                 Buy   Sale

               Choose

                                    Decide

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Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
01.
                                        Decide

    Hunting
    Hunters know exactly what they
    want and need the fastest way to
    get it.                            Purchase

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Digital Experience: Building 23+ million Zalando shops - Capital Markets Day 2018
Discover
                          02.

Choose                    Exploring
               Decide
                          Explorers have a certain need but
                          want to get inspired first, even it’s
                          based on style preferences.
         Buy

                            10
What
     How do we delight our
     customers?

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Our strategic pillars

     Inspiration          Advice           Relevance

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Inspiration

        from                    to

                        Shoppable content
     Mainly
                        available on all
     products
                        customer journeys

     Mainly our voice   Many voices

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Advice

        from                     to

     Disconnected       Immersive journeys
     channels           across all channels

     Static content     Different media

     Focus on           Curation through
     individual items   outfits and collections

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Relevance

        from                     to

                         Unique, personalized
     One-size-fits-all   experience including
     experience          preferences, such as
                         sizing

                         Fluid & immersive
     Linear journey
                         experience

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What
     How do these shifts look
     like when customers
     experience Zalando?

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Please meet Floyd.

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Journey 1:
Floyd

Floyd, mainly a hunter, is
browsing the Zalando app
while waiting for the Bus. He
follows a brand that he likes.

                                 18
Journey 1:
Floyd

He starts browsing for Fila
shoes and gets Smart
Filters suggested based on
his previous purchases.

                              19
Journey 1:
Floyd

Because he’s following Fila
he gets notified about a new
exclusive collection.

                               20
Please meet Polly.

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Journey 2:
Polly

Polly, mainly an explorer
wants to go to a party and
she’s looking for style
advice so she checks out
Zalando.

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Journey 2:
Polly

On the homepage Polly
discovers a video, featuring
personal stories
around style.

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Journey 2:
Polly

She scrolls down and
discovers Trends.

 24
Journey 2:
Polly

She explores “Dark
Summer”, showcasing
products all related to the
Trend.

 25
Journey 2:
Polly

She discovers Trend
Collections by
Influencers.

 26
Journey 2:
Polly

She discovers Trend
Collections by
Influencers.

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A few days later…
Journey 3:
Polly

Since Polly hasn’t bought
anything yet, she returns.
When searching for it she
finds products, outfits and
collections based on her
style profile.

                              29
Journey 3:
Polly

She finds a dress that she
likes and explores related
outfits based on style.

                             30
Journey 3:
Polly

She continues exploring and
finds related collections
based on style.

                              31
Impact
We drive substantial impact proven by high A/B frequency testing

      +101%                           +39%                        +40%                     from
                                                                                                   8%
     Conversion rate from
    customers who interact
                                  Basket from customers
                                  who interact with outfits
                                                              Total page views per user
                                                                        (yoy)
                                                                                           to
                                                                                                  20%
           with outfits            vs. those that do not
     vs. those that do not
                                                                                           Zalando’s share of
                                                                                          voice/awareness on
                                                                                             Instagram in DE
          200k                     +17.7%                       +12.5%                        among opinion
                                                                                           leaders/influencers
   Manually created outfits       Time onsite spent per        Revenue per user (yoy)     increased from Feb.
             live                      user (yoy)                                                to April.

33 as at May 2018
Outlook

     Our fashion platform delights customers with a beautiful and consistent experience optimized for
     personal relevance

     Products, outfits and collections are browsable on all relevant dimensions, facilitating an effortless and
     joyful navigation through our assortment

     We use inspiring, shoppable content to connect with our customers emotionally, driving engagement
     and retention

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We are building truly
     unique fashion
     experiences to
     democratize fashion

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DISCLAIM ER

Certain statements in this communication may constitute forward looking statements. These statements are based on assumptions that are believed to be reasonable at the
time they are made, and are subject to significant risks and uncertainties. You should not rely on these forward-looking statements as predictions of future events and we
undertake no obligation to update or revise these statements. Our actual results may differ materially and adversely from any forward-looking statements discussed in this
presentation due to a number of factors, including without limitation, risks from macroeconomic developments, external fraud, inefficient processes at fulfillment centers,
inaccurate personnel and capacity forecasts for fulfillment centers, hazardous material / conditions in production with regard to private labels, lack of innovation capabilities,
inadequate data security, lack of market knowledge, risk of strike and changes in competition levels.

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