Zalando from shoe e-tailer to the AWS of the fashion world
The once named European clone of Zappos has become the European e-commerce fashion powerhouse. Within the last years Zalando managed to ramp up its tech and build more than a standalone IT e-commerce function. Tech.eu News announced that Zalando is the most visited fashion website outside China since last year, thereby beating H&M online shop as well as other market giants (Mac, 2014).
Zalando began as a start-up at the German incubator Rocket Internet in 2008. During this initial start-up phase Zalando specialised in selling shoes, which become known through its aggressive marketing strategy. In case you need a reminder:
Within the last years Zalando heavily invested in data engineering transforming from a pure e-commerce to a platform provider for the fashion world with data at its centre. Robert Gentz one of the three founders and current CEO points out that “consumers don’t come to Zalando because we sell them fashion. They come to us because we provide them with solutions and convenience” (Kennedy, 2015). The idea is that the basis of this value proposition will also apply for Zalando’s suppliers, whereby fashion brands, retailers, designers and manufacturers can adopt services to increase customer insights such as purchasing patterns and mobile behaviour. Thereby the company is aiming to become a platform like Amazon Web Services (AWS) but for fashion. This comparison to AWS by Gentz stresses the gravity changing from a retail model to a platform model. To guarantee the success of this platform, Zalando needs to yield the best proprietary data on fashion to connect brands with their customers, propose the right personalisation recommendation for customers and give insights to designers and manufacturers on where the customer preferences are going.
To attract the best talent in data science Zalando is relying on the tech cluster Dublin as its source of new strength. In addition to its approximately 800 employees in the Berlin tech area (Shotter, 2015), Zalando has announced to create 200 new positions for data scientists to join its fashion insights centre in Dublin. Thereby the company takes its own approach to integrate data scientist with tech-engineers.
For more in-depth news you can check out the Zalando tech blog: https://tech.zalando.com/blog/
Kennedy. (2015). Zalando CEO: ‘We are building the AWS of the fashion world’ https://www.siliconrepublic.com/enterprise/2015/09/30/zalando-ceo-robert-gentz-we-are-building-the-aws-of-the-fashion-world
Mac. (2014). Revenge Of The Ripoff: How Zalando Became A $5 Billion Retailing Sensation. Forbes. http://www.forbes.com/sites/ryanmac/2014/07/30/zalando-europe-zappos-fashion/
Shotter. (2015). Zalando focuses on tech for growth – FT.com. Retrieved October 10, 2015, from http://www.ft.com/intl/cms/s/0/40db09a0-668d-11e5-a57f-21b88f7d973f.html
Shotter. (2015). Zalando’s growth mirrors Berlin’s vibrant entrepreneurial scene – FT.com. http://www.ft.com/intl/cms/s/2/7c9a5408-47ea-11e5-af2f-4d6e0e5eda22.html