In the run up to this year’s InternetRetailing Summit in Berlin we’re speaking to senior retailers who are taking part. Today we hear from Andreas Antrup, vice president, data and advertising at Zalando .
InternetRetailing: At the InternetRetailing Summit you’re going to be talking about the value of innovation. Tell us about innovation at Zalando through one or two examples.
Andreas Antrup, VP advertising at Zalando: Innovation has been part of Zalando from the start, when free shipping and returns meant a blanket guarantee that customers could check and send back any products that were not to their liking.
More recently, Zalando innovated in order to overcome a significant barrier towards adopting ecommerce – that of customers being out of pocket when they pay for things that they want to try. The solution there was payment by invoice, so that the customer just pays when they know what they want to keep. It’s another way of issuing a guarantee to the customer.
IR: How do you encourage innovation at Zalando?
AA: If you look at the company from the outside you’d see explicit measures that push innovation forwards. Our company goals include clear expectations of improving and increasing new customer experiences. This applies to a framework whose central pillars include the assortment that we sell, the convenience proposition around that, such as delivery and logistics, and the digital experience, which goes across the Zalando shop. Within these three areas, we’ve innovated where it’s necessary to keep up the pace. It’s important to reflect market demand.
But more importantly, innovation is part and parcel of our culture. If you come to Zalando and ask for the innovation department you won’t find one. Innovation is simply expected, everywhere and from everyone in the company.
IR: Do you have advice for other retailers on where it’s worth innovating?
AA: There’s always a lot of trends and new opportunities that one could pursue. While it’s true that one should plant many seeds if one wants to reap the harvest later on, one also shouldn’t plant too many. It’s easy to lose focus and to be stretched too far. Many trends blow over – remember the hype around Google Glass and around the Apple Watch. If you compare the hype of two years ago to the commercial reality today, those things were clearly overrated; for now at least.
That leads you to think then why don’t I just be a more astute and savvy follower. It’s important to lead in areas such as assortment that are your core focus, but when it comes to new customer experiences perhaps even to distribution channels, one need not necessarily be the innovator.
At the same time, there are some long-term trends that are fairly obvious. The overarching one is digitisation, followed by the convenience trend I mentioned in the beginning about Zalando, and then the main wave we are experiencing at the moment. Thats all about machine learning and artificial intelligence, and building consumer services and upgrading processes through data. On the horizon, the lines between commerce, content and services are starting to blur, especially in China and we can expect that to arrive here in a few years. Retailers can think today about how they leverage this data and machine-learning trend, and how they position themselves to leverage this new trend of content-commerce convergence in future.
IR: How do retailers best get traction with customers for new approaches and innovations?
AA: Everything must be in place and work before it really scales in the consumer sphere. Even value enhancements that seem obvious to the retailer aren’t necessarily obvious to the consumer – you need to iterate and persevere a bit before giving up. At the same time, to come back the idea of planting seed, you do have to cut back the things that just don’t work. One example from Zalando is that for a while we experimented with using local weather conditions as a shopping signal. If half the country was experiencing heavy rain we would say ‘hey look, here’s a nice coat’. But I can say that going in that direction was not in the end successful. Weather is not such a strong signal after all, and people buy things not only for today but for a longer period of time. But the initial idea was also not all misguided – we see a big impact from the weather on what people buy, and whether they shop at all.
In the end, the really important bit is to relentlessly focus on one’s customer. All these new innovations and market trends are part of delivering value to your customer. The most important thing is to stay atop of what your customer segment considers particularly relevant, or less relevant, and then exactly cater to that. All the other things are just a means to an end in this quest.
Andreas Antrup will be taking part in a leadership panel, Investing services beyond the obvious that no-one asked for to create a new normal, at the InternetRetailing Summit.
The InternetRetailing Summit is held in Berlin and runs from July 3 to July 5 2017. It brings together senior figures from leading retailers from across the European Economic Area (EEA) plus Switzerland for an immersive three-day event spent focusing on the way that multichannel retailers are innovating to improve the customer experience. It is held in partnership with our IREU Top500 research project, and aims to give Europe’s Top500 retailers the opportunity to spend three days learning from, sharing with and simply talking to other leaders in the ecommerce and multichannel industry.
To find out more about the event click here.
