Zalando ventures further into AI and social commerce

Zalando is back on track, as both sales and profits increased in the second quarter. The future should bring greater use of artificial intelligence and the arrival of Chinese “teleshopping 2.0” in Europe.

50 million customers

Zalando’s quarterly sales rose 3.6 % to 2.8 billion euros. The fashion marketplace sold 3.8 billion euros worth of products (in gross value), up 2.8%, and served just under fifty million customers. Gross profit margin improved 0.8 percentage points to 6.5 % of sales, thanks to more efficient inventory management and lower fulfilment costs. Adjusted operating profit rose from 144.8 to 171.6 million euros.

Zalando’s efforts in the sports, designer and beauty categories are paying off, while sales in B2B fulfillment increased by more than 10 %. Investments will increase as well: after the Zalando Assistant, a chatbot that helps customers, Zalando is now deepening its cooperation with OpenAI to develop “more innovative Generative AI solutions tailored for the fashion industry.” Existing examples include content and background images for products.

Zalando also wants to bring “social commerce” to Europe. The company is opening a new hub in Shenzhen to translate Chinese expertise in purchasing via social media into “personalised inspiration and entertainment” for the European marketShopping via livestreams, similar to the teleshopping of yesteryear, is very popular in Asia – but it is not really catching on in Europe (yet).