German distributor Otto is investing no less than 300 million euro in the expansion of its online platforms over the next three years. The existing platforms as well as new initiatives will be getting an extra impulse.
Towards 8 billion euro online sales
Otto sells clothing, shoes, toys, sporting goods, leisure products and more. It does so through physical stores, catalogues and more and more through the internet: the online channel is worth 5.7 billion in sales on a yearly basis, the coming years that should evolve to 8 billion euro.
Online sales are worth 57% of total sales of the company, in its home country Germany that number rises to 62% - and the company wants to enlarge that share even further during the next few years. At the end of last year Otto invested in the takeover of the name Neckermann.de. Worldwide Otto is the second most important online seller to private buyers, after Amazon.
Otto sells its products through about sixty websites. Four out of five have been adapted for tablets and smartphones. Not unimportant, because sales via these devices has tripled over the past few years.
Otto focuses strongly on developing pure online players: for example, it wants to bring sales of its online toyshop myToys.de, founded in 1999, from the current 280 million euro to 500 million euro. A project that focuses on young women is planned for the beginning of 2014.
Otto also participates in start-ups: since the fall of 2008 it has supported more than a hundred initiatives in Europe, Asia and North and South America. Overall Otto has invested over 100 million euro in new businesses, who usually get five years to prove themselves.
Otto made the move towards online in 1995. Within the next months it wants to launch its own payment solution, named Yapital, which can be used by companies that have a multi-channel strategy. Business from the company and third parties, like SprotScheck and Görtz, will be using Yapital.