LONDON — Apps — a magnet for young, tech-savvy women and an opportunity to seize more revenue — represent the next wave of disruption for e-commerce.
So says Moritz Hahn, senior vice president of market and category management at Zalando SE, who described app customers as more loyal, more engaged — and more apt to spend freely.
“Those app customers are crazy good customers, I have to say. They come more often, and when they buy, they buy more,” the executive said, noting more than 16 million people have already downloaded the Zalando app.
While he didn’t give precise numbers, he said the revenue share of app customers is higher than the traffic share. They spend twice as much as desktop users; four times more than mobile site users, and visit up to six times more than other channels.
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Echoing other speakers at the London Digital Forum, the German retail executive described rapid adoption of mobile technology, which he described as the “entry point” for app users.
Already, 60 percent of Zalando’s traffic is mobile, up from 48 percent 12 months ago, and spiking as high as 70 percent during the peak holiday period.
Consequently, Zalando takes a “mobile-first” approach to service, content and technology enhancements. “We always pioneer with the app,” Hahn said, while stressing that customers will enjoy a “similar experience” across other devices, including desktop computers.
“The big advance with mobile is that we know where you are. In the past, we only knew where you lived,” he said.
Hahn opened his address by describing Zalando’s wish to become each customer’s “fashion companion,” an expert who can advise on the latest brands and styles — and also “take care of the boring stuff,” meaning payments, deliveries and returns, if necessary.
Zalando offers free shipments and returns, and encourages at-home fittings, billing only once the customer has committed to the item. “Pay as you keep,” is how Hahn dubbed it. This generous approach, plus a large assortment, is meant to position Zalando as the go-to e-tailer for “every occasion.
“We’re your fashion companion if you go to the Berghain club or to a conference like this or a beach holiday,” Hahn said, name-dropping the famous Berlin techno temple.
Besides a comprehensive assortment, Zalando also focuses on “relevant personalization” to help users wade through the choice, along with a “frictionless” transaction experience and a “lovable” brand personality.
Given Zalando’s scale, it has assembled a “huge number of attributes” about its customer base, data that allows it to make relevant recommendations.
For example, via algorithms, the retailer is able to “find your fashion twin,” a customer who bought the same items, enabling Zalando to recommend with confidence brands and specific styles. “If he clicked on bomber jackets or specific sneakers the likelihood that I love the sneakers too is unbelievably high,” Hahn enthused.
He characterized its scale and data pool as a powerful selling point to bring on new vendors. “We can introduce your brand to the right audience,” he said, arguing that multibrand retail apps are more compelling for the customer.
“With this app situation, I don’t know if you want to have your stand-alone luxury app. For me, luxury is more often a mix-and-match approach and I would rather bring it into the mix-and-match funnel.”