Zalando and the fashion industry today

The fashion industry is in a state of flux. On the one hand, after the Covid years, many fashion retailers have financial problems and are facing insolvency. This year alone, several fashion giants such as Galeria or Peek & Cloppenburg have already filed for insolvency. In 2022, 102 producers and retailers in the textile industry were affected and filed for insolvency.

But there are also many changes in the online world. The largest online fashion retailer in Germany and Europe is Zalando. For some time now, we were able to see that it is no longer possible, or only possible with difficulty, to participate in the Zalando affiliate program. This is due to the fact that Zalando wants to clean up its assortment. It can even happen that certain brands are kicked out of the partner program if Zalando is of the opinion that the products no longer fit the company. The new motto is quality instead of quantity in order to offer customers better products. Lastly, there was also a new fee schedule for Zalando partners who sell their products on the platform. According to Zalando, this has been standardized, but the result is that it is no longer profitable for many retailers to sell on Zalando. This is because commissions of 25% are incurred in some cases as a result of this new order. Therefore, more and more retailers want to turn away from Zalando.

What alternatives are there?

About You

About You is also a fashion and lifestyle marketplace and is active in several countries in Europe. The marketplace has over 30 million active users per month and therefore offers a lot of potential. About You’s goal is to put a focus on personalization and offer customers a personalized shopping experience. To show this directly, About You even advertises with the slogan “Europe’s most personal fashion online store”.

Otto

Otto is also a good alternative to Zalando. Each month, 59.8 million visitors visit the platform. In addition to clothing, Otto also offers household products, furniture and much more, making it a generalist among marketplaces. Otto is very well known in Germany and advertises itself with 11 million active customers and up to 10 orders per second. With this, Otto definitely brings a lot of potential.

limango

If it’s more about kids fashion, then limango is a great place to go. Limango is aimed at young families and sells fashion products to babies, children and adults. In addition, the marketplace also has Home & Living products on offer. According to limango, there are 1.9 million active customers on the marketplace and is the top platform for young families.

YOOX

Then there’s also the YOOX marketplace. YOOX describes itself as the “world’s leading online lifestyle store.” YOOX is more for premium products, you can find lots of designer brands like Versace, Prada and Gucci. So for high-end and high-priced clothing and shoes, YOOX is the perfect marketplace.

Marketplace Newcomer – Best Secret

The fashion world is huge, of course there are many more marketplaces where products can be sold. Also, new ones are added regularly or well-known fashion brands expand their range and become marketplaces. One example of this is Best Secret. This off-price shopping club has already announced that it will expand its offering to include a marketplace model. At the moment, this model is already being tested with a few brands in Germany, but is soon to be expanded and spread to the whole of Europe.

Conclusion

The current situation with Zalando shows us that we must not become too dependent on a single marketplace. However, this does not mean that you have to be directly present on all marketplaces. We recommend building up competencies in the marketplace area and then making informed decisions, because each marketplace has its advantages and disadvantages that need to be recognized.

What exactly is Zalando Brand Home?

With Brand Home, partners have been able to present their brand specifically and, above all, authentically on Zalando since October 2020. You can creatively put collections and products in the foreground in order to improve the shopping experience of your customers. This not only offers the brands many advantages, but of course also Zalando itself.
First and foremost, Zalando would like to use this service to strengthen and expand its own platform. In the future, customers should get more than just a large selection of products and good service. Zalando should become a source of inspiration and a contact point for fashion questions. To achieve this, the online marketplace relies on the help of its partner brands. These should create valuable and relevant content for their brand fans in order to increase the customer experience and the length of time they spend on the platform.

What are the advantages of creating a branded store?

The partner brands also benefit greatly from the creation of a brand home. So far they could only offer their products for sale on the fashion marketplace and advertise them with the help of campaigns. Now they have an area for the presentation of their own brand and product world. Partner brands on Zalando should definitely use this option for themselves, especially since there are no additional costs for registration.

Advantages of a brand home at a glance:

• Strengthening the organic reach on Zalando
• Deepening the customer relationship through relevant content
• Brand fans can follow their favorite brands and receive push notifications when there is news
• Content is maintained via a CMS itself, so the brands have full control over the content
• Brand Homes can be pushed through additional campaigns via Zalando Marketing Services

How can partners apply for their own brand home?

If a partner brand wants to create its own brand store, it must first apply for a Brand CMS account using a registration form. Multiple accounts for a Brand CMS are easily possible and each user receives an individual notification by email as soon as access has been set up. This can take up to 3 working days.
In addition, every brand has to meet a few requirements before they can start creating a brand home. The onboarding must be completely completed and at least 20 available articles must be listed in the Zalando Marketplace. Each user should also carefully read the content guidelines provided by Zalando in advance, as these should be strictly adhered to.

What data is available for further analysis?

In the analysis area, partner brands will find all relevant KPIs with which they can gain important information about their brand home. Traffic, clicks, views, click-through rate (CTR) or add-to-cart are clearly displayed in a dashboard. They also get deeper insights into the individual collections and the development of the followers. The content performance of your own brand can be compared, for example, with the average content performance of other brands that have selected the same target group and target market. With the help of these numbers, your own brand home can be gradually optimized in order to increase sales.

Is it worth creating a brand home on Zalando as a partner brand?

Brands that already sell their products at Zalando and have at least 20 available items in their range should definitely use the Brand Home as an additional channel to increase brand awareness. It is a direct line to your own brand fans, as the content is maintained independently and followers receive an automatic notification of news. This strengthens customer loyalty and improves the shopping experience.

For whom is it worth selling on Zalando for ?

Zalando is still one of the most popular marketplaces for fashion, beauty and lifestyle. There is a wide range of products available from clothing, shoes, beauty and lifestyle products to accessories such as sunglasses and jewelry. In the future, Zalando will also focus more on the beauty area in order to meet the demand there.

How can I promote my brand and products on Zalando?

Through Zalando’s 360° Marketing Unit Zalando Marketing Services (ZMS), Zalando offers various advertising options within and outside its own platform to put your brand in the spotlight and to grow it on the online platform. They can be roughly divided into two types: branding and performance.
Branding campaigns make your own brand better known on the online platform, while performance campaigns are intended to place your own products more prominently and increase sales. Since Zalando offers numerous advertising options, we give you an overview below of the measures that are relevant for most brands.

With these advertising options you draw attention to your brand and products

Homepage Teaser

The homepage teaser is probably the most prominent placement right on the homepage. It consists of an image and you can also add a headline and a subtitle. You can also include a Call to Action ( CTA ) to communicate directly with your potential customers.
In addition, you can integrate a carousel with 25 articles in the homepage teaser to best position the products next to the brand.

Video Teaser

The video teaser pursues the same goal as the homepage teaser, just in video format. Here too there is the possibility Headline, Subtitle and CTA to create and emphasize the 25 ites per carousel.

Catalog Teaser

The catalog teaser is a banner form that is placed within the product categories. This ad format consists of an image or video with a headline, subtitle and CTA to promote your own brand. The condition is that the advertised product also belongs to this category. Shoes can therefore only be advertised in the shoes category.

In-Catalog Ad

The In-Catalog Ad is a display format that consists of an image, headline, subtitle and CTA . The ad size is always placed in the 10th position on a catalog page. It is characterized by a background color, which should also be as striking as possible to generate more attention. For brave brands, there is also the option to use a GIF to stand out. The only requirement for the ads is that they must be product related and fit into the appropriate category.

Sponsored Products

The sponsored products are a very good marketing opportunity to directly increase sales at Zalando. You can advertise a list of products here to appear as high as possible in search results, even if the products don’t rank organically in the first place. The advertised products do not immediately stand out as advertising and can only be identified by a small “sponsored” comment.
Billing takes place here using a cost-per-click model, so that you only pay when the visitor actually clicks on your product. This makes this ad format particularly attractive, because you don’t pay for impressions, but direct users directly to your own product detail pages and only pay for relevant traffic that is interested in the products. With sponsored products, a direct link can therefore also be made with the return on ad spend (ROAS), which is usually not possible with branding measures.
It must be said that the rendering takes place with an algorithm that shows each user individually the products that match their search – based on their previous interactions with Zalando. Sponsored Products can be set up by us in Self Service or in collaboration with Zalando in Managed Service . For constant performance monitoring, Zalando provides reports once a week that allow us to make optimizations and manage the campaign as profitably as possible.

Newsletter Teaser

Using the newsletter teaser you can present your brand in the Zalando newsletter and present it to subscribers. It is possible to book a placement in the upper or lower part of the newsletter. Zalando sends out the newsletter twice a month. Images must contain a look or promote certain products available on Zalando. In addition to the image, the headline, subtitle and CTA can also be set separately.

Use Zalando’s social media channels as an advertising channel for your articles

Zalando also offers the possibility to advertise your brand through its social media channels. This is where the wide reach of these social media channels pays off as they can reach several million followers.
There are several ad placements for the major social networks, Instagram, Facebook, TikTok, Snapchat, and Pinterest.

Link Ads

May be up to 15 seconds of moving image video or still image video. It should include your brand logo to increase awareness. Tone and descriptions are optional, but Zalando recommends them. This ad format is shown to users in their personal feed on the platforms and fed back to Zalando.

Carousel Ads

A carousel can consist of a combination of multiple photos and videos. It allows the user to swipe sideways through the display to view more images. Users can also see this placement directly in the feed.

Collection Ads

This form of advertising consists of a combination of images, videos and a dynamic SKU selection and is only available on mobile devices. Make the article list as wide as possible (minimum 25 products), as it is displayed dynamically, depending on the availability of the individual articles on Zalando.

Dynamic Ads

A combination of a video/photo and an advertised SKU. The first card should represent a static image and the second a product to be advertised. Again, as described above, the same recommendation applies to list a minimum of 25 SKUs, as the playout is also done dynamically here.

Instagram Stories

An Instagram story can consist of up to 10 stories for your brand. A combination of video and image is also possible here. Messages can be integrated directly into the images and videos, as no description in text form is possible.

You can use these ad formats to drive external traffic to your products at Zalando

Zalando also offers the possibility to place ad formats outside of Zalando, which then feed back to the Zalando platform.
The best-known formats here are the banner ads, which are placed on websites and show items and brands on Zalando.
Other options include YouTube video ads. There are several ad formats, such as True View InStream, which the viewer can skip after 5 seconds. Here, charges are only incurred after the viewer has watched or interacted with the video for 30 seconds. There is also the option to place short videos, for example bumper ads, as ads within the YouTube clips that the viewer cannot skip. Here you get the full attention of your potential customers and invoice according to the CPM (cost per mille) model.

This is how we can support you on Zalando

As you can see, Zalando offers various advertising options to promote your brand and products and increase your sales. We recommend a performance-oriented marketing campaign, especially in the beginning, because the first results are visible in a short time. Based on this, it makes sense to use brand campaigns to raise awareness of your brand, win new customers and accelerate growth. We are happy to advise you on a complex marketing strategy when selecting the right advertising measures on Zalando.