As an effect of store closures in the course of the COVID-19 retail lockdowns in the first phase of the fight against the pandemic, Inditex reported heavy sales losses by mid-2020. The mother company of the Spanish fast-fashion brand Zara reacted with a major shift in its business strategy. It announced to close around 1,200 brick-and-mortar stores within the next few years.
The decision was likely not only based on the poor performance of the stationary retail business in the COVID-19 outbreak. It was likely based on the overwhelming success that Inditex’ online stores had at the same time. The biggest brand of the group, Zara contributed a major part. EcommerceDB has recently updated their sales figures and forecasts for zara.com – Zara’s main fashion online store – and zarahome.com – the brand’s home textiles and houseware online store. This reflects the more than positive e-commerce development of Zara.
Zara’s main fashion URL, zara.com, had constantly grown its net sales by substantial double-digit year-on-year rates in the past. 2017 had been a record growth year. In addition to a plus of 43% year-on-year, but only until COVID-19 hit. In 2020, zara.com topped this rate and increased their online net sales by an amazing 64% compared to 2019. This resulted in total e-commerce net sales of €5.9 billion.
Zara’s home decoration online store, zarahome.com, is far from this net sales amount. Zarahome.com generated total net sales of €322 million in 2020. In terms of growth, however, the Zara store for home textiles and houseware outperformed the fashion store by far. With a year-on-year growth of 126%, zarahome.com grew twice as fast as zara.com.
The upward trend is more than likely to continue for both Zara online stores. Zara.com and zarahome.com are projected to stay on a double-digit growth path through the years 2021 and 2022. Furthermore, zarahome.com is forecast to more double their net sales again within the next two years. As nobody can currently estimate how long COVID-19 will still be around and as consumer habits have likely changed sustainably in favor of e-commerce, it is a reasonable move of Inditex to expand their online business further.
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