How to achieve growth
in e-commerce ?
⏐Growth hacking⏐ Zalando ⏐ Asos ⏐Case study
© H. Isaac
1
Growth issues in e-commerce
•  Growth is a very important strategic issue
–  Break-even point requires high volume (fixed costs issue)
–  Volume increases profitability by enabling purchasing
price reduction (negotiating power gross margin)
•  How to achieve growth ?
–  Diversification (i.e. catalog extension)
–  Internationalization
•  From local to Europe
•  Global from scratch
–  Economy of scale generation
–  Marketplace
2
© H. Isaac
Amazon growth model
© H. Isaac
3
Source: Amazon
A european strategy
Source: all data from Zalando public financial statements
4
© H. Isaac
Zalando Business Model
© H. Isaac
5
Zalando Business Model
© H. Isaac
6
Web site
Mobile (40% MAU)
Shop (Berlin)
Private Label
Online
marketing
Data-driven
Sourcing
IT platform
Warehouse
Brand
Intl payment
platform
Third party
fashion brands
(data driven
relations)
11 logisitics
partners
Marketing costs 13,6%
Fulfillment costs 23,4%
14
european
countries
Women
Men
150 000 styles
1 500 brands
Local
Global
Fast
Private Label
High Avaibility
Better selection
Free delivery &
returns
Personalized
shopping
experience
Gross Margin 40 to 60 %
Net margin 1,2 %
Steps in business development
7
© H. Isaac
Source: Zalando
European growth strategy
8
© H. Isaac
Source: Zalando
Market size⏐ Brand awareness
9
© H. Isaac
Source: Zalando
Zalando Key metrics
10
53,2%41,5%
+11,5%
37%
Increased Brand awareness &
quality of execution increase
Repeat purchase
© H. Isaac
Economy of scale generation⏐1
11
© H. Isaac
Source: Zalando
Economy of scale generation⏐2
12
© H. Isaac
Source: Zalando
Marketing costs ⏐Loyalty
13
© H. Isaac
Source: Zalando
Group EBIT Margin
14
© H. Isaac
Source: Zalando
Zalando Key Success Factors
15
© H. Isaac
Source: Zalando
Zalando Growth’s vision
16
© H. Isaac
Source: Zalando
Zalando: Concluding remarks
•  High level of economy of scale
–  Fulfillment capacities
–  IT platform
•  Diversification in assortment
•  European markets extension
•  Strong branding that reduces Customer cost of
acquisition
•  Quality in operations execution that drives customer
loyalty
Ø High level of scalability
© H. Isaac
17
ASOS Business Model
© H. Isaac
18
A global strategy
Source: all data from Asos public financial statements
© H. Isaac
19
A worldwide strategy
© H. Isaac
20
Source: ASOS
ASOS Business Model
© H. Isaac
21
9 Web sites
Mobile (46% MAU)
Sourcing
Warehouse
800 Third party
brands
Tmall (China)
Marketing costs 5,7%
Fulfillment costs 22%
Worldwide
(200
countries)
20
somethings
Women
75 000 items
Newness
Gross Margin 49,5%
Net margin 4%
Private Label
(50%)
As seen On me
Recommendations
Rewards
Personal stylist
ASOS Internationalization
© H. Isaac
22
Source: Javelin Group, Planning for Europe, eCommerce futures, 5th February, 2014
A worldwide expansion
© H. Isaac
23
Source: ASOS
International strategy
© H. Isaac
24
Source: Javelin Group, Planning for Europe, eCommerce futures, 5th February, 2014
A difficult path to master operational costs
© H. Isaac
25
Source: ASOS
ASOS Key metrics
© H. Isaac
26
Source: ASOS
ASOS Vison of Growth strategy
© H. Isaac
27
Source: ASOS
Growth : audience monetization
© H. Isaac
28
ASOS: concluding remarks
•  From UK to Worldwide sales
•  Categories extension
•  Opening China market with Tmall
•  Marketplace opening
© H. Isaac
29

Growth hacking-in-ecommerce. Zalando & ASOS cases

  • 1.
    How to achievegrowth in e-commerce ? ⏐Growth hacking⏐ Zalando ⏐ Asos ⏐Case study © H. Isaac 1
  • 2.
    Growth issues ine-commerce •  Growth is a very important strategic issue –  Break-even point requires high volume (fixed costs issue) –  Volume increases profitability by enabling purchasing price reduction (negotiating power gross margin) •  How to achieve growth ? –  Diversification (i.e. catalog extension) –  Internationalization •  From local to Europe •  Global from scratch –  Economy of scale generation –  Marketplace 2 © H. Isaac
  • 3.
    Amazon growth model ©H. Isaac 3 Source: Amazon
  • 4.
    A european strategy Source:all data from Zalando public financial statements 4 © H. Isaac
  • 5.
  • 6.
    Zalando Business Model ©H. Isaac 6 Web site Mobile (40% MAU) Shop (Berlin) Private Label Online marketing Data-driven Sourcing IT platform Warehouse Brand Intl payment platform Third party fashion brands (data driven relations) 11 logisitics partners Marketing costs 13,6% Fulfillment costs 23,4% 14 european countries Women Men 150 000 styles 1 500 brands Local Global Fast Private Label High Avaibility Better selection Free delivery & returns Personalized shopping experience Gross Margin 40 to 60 % Net margin 1,2 %
  • 7.
    Steps in businessdevelopment 7 © H. Isaac Source: Zalando
  • 8.
    European growth strategy 8 ©H. Isaac Source: Zalando
  • 9.
    Market size⏐ Brandawareness 9 © H. Isaac Source: Zalando
  • 10.
    Zalando Key metrics 10 53,2%41,5% +11,5% 37% IncreasedBrand awareness & quality of execution increase Repeat purchase © H. Isaac
  • 11.
    Economy of scalegeneration⏐1 11 © H. Isaac Source: Zalando
  • 12.
    Economy of scalegeneration⏐2 12 © H. Isaac Source: Zalando
  • 13.
    Marketing costs ⏐Loyalty 13 ©H. Isaac Source: Zalando
  • 14.
    Group EBIT Margin 14 ©H. Isaac Source: Zalando
  • 15.
    Zalando Key SuccessFactors 15 © H. Isaac Source: Zalando
  • 16.
    Zalando Growth’s vision 16 ©H. Isaac Source: Zalando
  • 17.
    Zalando: Concluding remarks • High level of economy of scale –  Fulfillment capacities –  IT platform •  Diversification in assortment •  European markets extension •  Strong branding that reduces Customer cost of acquisition •  Quality in operations execution that drives customer loyalty Ø High level of scalability © H. Isaac 17
  • 18.
  • 19.
    A global strategy Source:all data from Asos public financial statements © H. Isaac 19
  • 20.
    A worldwide strategy ©H. Isaac 20 Source: ASOS
  • 21.
    ASOS Business Model ©H. Isaac 21 9 Web sites Mobile (46% MAU) Sourcing Warehouse 800 Third party brands Tmall (China) Marketing costs 5,7% Fulfillment costs 22% Worldwide (200 countries) 20 somethings Women 75 000 items Newness Gross Margin 49,5% Net margin 4% Private Label (50%) As seen On me Recommendations Rewards Personal stylist
  • 22.
    ASOS Internationalization © H.Isaac 22 Source: Javelin Group, Planning for Europe, eCommerce futures, 5th February, 2014
  • 23.
    A worldwide expansion ©H. Isaac 23 Source: ASOS
  • 24.
    International strategy © H.Isaac 24 Source: Javelin Group, Planning for Europe, eCommerce futures, 5th February, 2014
  • 25.
    A difficult pathto master operational costs © H. Isaac 25 Source: ASOS
  • 26.
    ASOS Key metrics ©H. Isaac 26 Source: ASOS
  • 27.
    ASOS Vison ofGrowth strategy © H. Isaac 27 Source: ASOS
  • 28.
    Growth : audiencemonetization © H. Isaac 28
  • 29.
    ASOS: concluding remarks • From UK to Worldwide sales •  Categories extension •  Opening China market with Tmall •  Marketplace opening © H. Isaac 29