Major German fashion and shoe e-retailer Zalando is testing free same-day deliveries in Cologne and Bonn, and is planning to open its biggest logistics centre in south-western Germany after raising its revenues over 30% in H1 2015.
With free delivery and returns being part of Zalando’s policy, the same-day service, operated by Liefery, will also be offered for free in the initial phase. It is not clear yet how long the pilot project will last and if the service will remain free in the long run.
“We want to find out how delivery on the same day will be accepted by our customers. In case of high acceptance, we might extend the service to other big cities. We have not fixed yet how much the service will cost,” the e-commerce retailer said.
Zalando explained how the same-day service works in Berlin and Cologne: “We are picking out random customers in the two cities who we surprise with an upgrade. They get a message around 4 pm that the goods they ordered will arrive the same day between 7-9 pm. Until now, the customer feedback towards same-day delivery has been very positive. One customer who got her bridal shoes on the day she ordered them was very happy.”
In addition, the company is planning the construction of its fourth logistics centre in Lahr, Baden-Württemberg, to start in October this year. The centre is due to start operating (test operations) in autumn 2016. With an area of 130,000 sqm, it will be the retailer’s biggest facility, surpassing the size of its existing logistics centres in Erfurt and Mönchengladbach (125,000 sqm each) and in Brieselang (25,000 sqm). After Erfurt and Mönchengladbach, Lahr will also be Zalando’s third self-operating logistics centre.
The new facility will allow Zalando to serve customers in Southern Germany, Switzerland and France even faster and to keep up with growing demand. About 1,000 jobs are due to be created at the site located in the Upper Rhine region. Zalando currently employs over 5,000 people at its existing logistics centres.
“Customers are at the core of our work and we invest in numerous measures to further increase their satisfaction. Zalando Logistics plays a central role as one of our main competencies in our future development,” David Schröder, Senior Vice President Operations at Zalando SE, said.
Lahr was chosen over a range of other German locations due to its favourable geographical location and infrastructure. The facility in Lahr is estimated to cost about €100 million – the same amount that Zalando already invested at its Erfurt logistics centre, according to the German logistics newspaper DVZ.
Zalando plans to open further regional centres in Europe, Schröder said at a logistics forum in Mönchengladbach, the DVZ reported. Beyond Germany, Zalando now only has return centres abroad operated by Docdata and Fiege. From Germany, it serves 15 countries but remains mainly focused on its domestic market as well as Austria and Switzerland.
Zalando’s shops attract over 135 million visits per month. In the second quarter of 2015, around 57% of traffic came from mobile devices, resulting in close to 16.4 million active customers by the end of the quarter.
During the first half-year of 2015, Zalando recorded revenue growth of up to 31.5% reaching €1.38 billion and raised its outlook for the whole year to 28-31% growth, which is significantly above the initial 20-25% guidance.
Rubin Ritter, Member of the Management Board, said: “Zalando is powering ahead to take full advantage of the great opportunities in European fashion e-commerce. Thanks to our clear focus on customer satisfaction, we have delivered exceptional revenue growth at scale and improving profitability in the first half of 2015.”
