The addition of a their own third-party marketplace is becoming a common growth driver among retailers looking to expand their e-commerce reach while minimizing the risks associated with sourcing and distributing additional products themselves. Besides additional sales profits, retailers anticipate that adding select merchants to their platforms will enable them to react more quickly to new trends and drive profitable sales without taking on additional inventory while dominating wider market areas. For smaller brands, appearing under a brand-owned marketplace might be a strategy for building brand awareness, acquiring new customers and growing business.
Europe’s leading fashion marketplace Zalando offers fulfillment and marketing solutions to brands joining the partnership. Brand partners can use their own logistics and save on shipping costs with Zalando Fulfillment or do a mix of both. Brands also have the option to use Zalando’s warehouses for what they don’t sell on the platform. Moreover, Zalando works with trusted local partners for delivery and payment solutions in each market, and its local marketing teams translate offers to appropriate regions. In knowing Zalando’s sales goals, the platform has become less of a retailer and more of a supporter of brands.
The European fashion market is one of the largest and most attractive global consumer markets. The industry is experiencing radical change, due to digitization. New technologies connect all participants in the fashion ecosystem – customers, brands, retailers, manufacturers, stylists, content providers such as influencers, logistics companies or service providers – and open new channels for consuming, producing and doing business.
Zalando aims to be the starting point for fashion, connecting all players in the industry and catering to their requirements with its marketplace platform strategy at the center. Their holistic strategy for a connected fashion world helps keep them one step ahead of the ever-evolving commerce landscape.
This article originally appeared in the PSFK iQ report, Multi-Brand Marketplace Strategy.