Zalando supports brands in COVID-19 crisis

April 24, 2020 by
Sanne Leenders

Europe's leading online platform for fashion and lifestyle, Zalando, aims to accelerate its platform business. During the COVID-19 crisis the fashion and lifestyle company decided to introduce several initiatives to support other fashion brands.

Zalando's Partner Program offers immediate support to its brand partners. The Partner Program allows the brand partners to connect more easily with the Zalando platform. Brand partners can benefit from faster pay-out terms when they are in the need of immediate cash relief until the end of June. The visibility of small to midsize partners in the shop will be improved further by the fashion and lifestyle company. Through the Partner Program sales improved rapidly during the Easter Weekend, more than 100% compared to 2019.

Expand offering to customers

Zalando plans to add textile masks to its assortment in the coming weeks. The profits which are generated from these sales will be donated by the company. Zalando also launched its first remotely produced marketing campaign using the hashtag #TogetherIAmStrong in response to the increasing demand in the sports category.

Decrease in customer demand

As a consequence of social distancing measures Zalando noticed a significant decrease in customer demand. The decrease in customer demand happened after a strong growth in January and February this year. In the following weeks of March, the company observed negative growth of its Gross Merchandise Volume (GMV). However, following the end of March, the GMV started to grow again. Zalando CFO David Schröder says that the first weeks of April look optimistic for the second quarter.

To counter the negative impact from the COVID-19 crisis Zalando launched a savings effort for this year. Zalando has planned savings of €250 million in marketing and overhead. As well as, around €100 million of reduced capital expenditure. This can ensure continued financial health and can enable the acceleration of strategic growth initiatives for the company.

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