[PPT] - Zalando Press Call February 27, 2020 February 27, 2020 Zalando PowerPoint Presentation

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February 27, 2020 Zalando Press Call

Zalando Press Call

February 27, 2020

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Customers declutter their wardrobe

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February 27, 2020 Zalando Press Call 2

Building the Starting Point for Fashion

Rubin Ritter, Co-CEO

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February 27, 2020 Zalando Press Call

Our vision: To become the Starting Point for Fashion

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Fashion Movies & Series Music

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February 27, 2020 Zalando Press Call

We remain convinced that online fashion is a long-term growth opportunity

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15% 20% 36% 45%

>25%

...aiming for €20bn GMV by 2023/24

>5%

Online fashion We are targeting a huge market opportunity1,… Total fashion >450bn

2014 ‘15 ‘16 ‘17 ‘18 ‘19 ‘20 2023/24

~20bn GMV by 2023/24

(1) Source: Company estimates and Euromonitor International forecasts, February 2019. Euromonitor forecasts the overall European Fashion Market to grow to roughly 450bn EUR over the next 5-10 years. Values based on actuals and estimates; fixed exchange rates. Fashion data incl. apparel and footwear, bags and luggage, jewelry and watches. Data for Europe (excluding Russia) inclusive of sales tax

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February 27, 2020 Zalando Press Call

In 2019, we have delivered towards our growth ambition

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growth of GMV generated through app

56%

GMV

8.2bn 4.2bn

+33% Site Visits

24%

GMV growth

31 million

active customers +4.6m

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February 27, 2020 Zalando Press Call

Zalando Plus is set to become an essential lever in deepening our relationship with our most valuable customers

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Plus customers are a lot happier¹, … Net-Promoter-Score in 2019 …engage more with us… Sessions per user …and hence spend more GMV per active Customer

(1) NPS comparison of Zalando Plus Customers vs Non-Plus Customers in Germany

+4 +70% >3x

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February 27, 2020 Zalando Press Call

Our 2020 initiatives to drive Active Customers growth

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1. Erfurt
2. Brieselang
3. Mönchengladbach
4. Lahr
5. Paris (FR)
6. Stockholm (SE)

Getting closer to our Spanish customers by

pening a local warehouse

We double down on Premium

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7. Szczecin (PL)
8. Olsztynek (PL)
9. Lodz (PL)
10. Verona (IT)
11. Milano (IT)
12. Rotterdam (NL)
13. Madrid (ES)

Large segment Market Size: ~40bn EUR Shifting online 16% online CAGR Customer interest 20m searches for luxury brands we do not have yet Order economics Above average basket sizes

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February 27, 2020 Zalando Press Call

do.MORE

To be a sustainable fashion platform with a net-positive impact for people and the planet.

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February 27, 2020 Zalando Press Call 9

Zalando to launch pre-owned category on main destination after testing since 2018, connecting buyers and sellers of pre-owned products

Pic of Customer/Wardrobe

Pre-owned Customers declutter their wardrobe Customers discover pre-owned item on Zalando

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February 27, 2020 Zalando Press Call 10

Building the Starting Point for Fashion

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Month, Year Presentation Title // Document info

Business Update

David Schröder, CFO

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February 27, 2020 Zalando Press Call

In 2019 we delivered strong financial results

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Revenue Adjusted EBIT

€6.5bn

2019

+20%

GMV

€8.2bn

2019

+24% €225m

2019

+30%

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February 27, 2020 Zalando Press Call

Cyber Week marked another important proof point for the potential of our platform business

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~20%

Partner Program Share

33m

Site Visits on Black Friday

+5

YoY in NPS in Cyber Week

~840k

Newly Acquired Customers

7,200

Orders/Minute at Peak Times

32%

YoY GMV Growth

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February 27, 2020 Zalando Press Call

In 2019, we achieved important milestones in driving the Platform Transition

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Q4 2018 40% PP share

f FS GMV1

5% 10% 75% ZFS share

f PP items2

15% ~25% ~0.7% +0.3% 3-4% of GMV2 Target-Model Q4 2019 Target model 15% ~40% ~1%

1) Partner Program share of 40% refers to our business model mix ambition for 2023/24. In our long-term target model, we aim for a 50% Partner Program share. 2) Refers to our long-term target model ambition.

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February 27, 2020 Zalando Press Call 15

In 2020, we will focus on four areas to drive the platform transition

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Internationalization of existing

Partners

New Partner Integration & Range

Extension of existing Partners

ZFS / Offprice Integration
Next Generation of Tooling

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February 27, 2020 Zalando Press Call

For 2020, we remain committed to our previous transition phase guidance, with strong growth momentum and continued investments in our customers and our platform

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GMV growth of 20-25% and Revenue growth of 15-20%

1) Excluding equity-settled share-based payment expense (“SBC”) of ~€50m, restructuring costs and non-operating one-time effects for FY/20E 2) Excludes M&A transactions

Adj. EBIT1 of €225 – 275m

Slightly negative working capital and around €330m capex2

Excluding a potential negative impact from Coronavirus

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February 27, 2020 Zalando Press Call

Q&A

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Month, Year Presentation Title // Document info

Reimagining Pre-owned Fashion

Anne Pascual, SVP Product Design

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February 27, 2020 Zalando Press Call

We’re deepening our relationship with customers

Fashion is about creating memorable moments, experiences and stories.

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February 27, 2020 Zalando Press Call

Customers want to discover pre-owned items and declutter

Especially Millennials and GenZ are requesting this.

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February 27, 2020 Zalando Press Call

Make it easy to buy and sell pre-owned

Customers love our Wardrobe app and how easy it is to buy and sell pre-owned items.

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February 27, 2020 Zalando Press Call

Our Answer: A new category pre-owned fashion

Buy pre-owned items on Zalando with the same seamless experience.

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February 27, 2020 Zalando Press Call

But we want to take it even further.

Extend the life of your fashion and sell the items you no longer wear to Zalando.

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February 27, 2020 Zalando Press Call

The starting point for fashion, new and pre-owned.

We are growing stronger by adding another dimension.

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February 27, 2020 Zalando Press Call

2020 Strategic Focus

Zalando Premium

freestock

Lena-Sophie Röper, Buying Director Premium & Luxury

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February 27, 2020 Zalando Press Call

We double down on Premium

Zalando‘s designer destination heavily grows contemporary and expands into luxury.

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February 27, 2020 Zalando Press Call

The premium & luxury market

Lucrative Approximately 9% of the total fashion market Digital Online sales share projected to grow heavily Growing Outpacing overall European fashion market

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February 27, 2020 Zalando Press Call 28

Over 20 Million no-hit searches for luxury brands in 2019.

Our Customers seek for Luxury

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February 27, 2020 Zalando Press Call 29

Zalando Premium

Successful Fastest growing Business Category within Zalando Expanding Acquired > 50 contemporary and entry luxury brands over the past 12 months Next Gen Premium customer base grew 23% in 2019; Gen Z customer base for premium grew 48% in 2019

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February 27, 2020 Zalando Press Call

The new luxury consumer

Young By 2025, >55% of Luxury customers will be Millennials and Gen Z* Diverse A great outfit is not defined by price but created through personal self-expression and creative individualism Aware Purchase decisions are influenced by relevance on social media, a brand’s authenticity and cultural credibility

30 * ICSC - Global Luxury Retail in the Digital Era

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February 27, 2020 Zalando Press Call 31

Mix and match: The new norm

Luxury Premium Streetstyle Vintage Pre-Owned

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February 27, 2020 Zalando Press Call

Our customer promises

World-class fashion inspiration New marketing plan and dedicated content & production team Unlimited choice One platform for all fashion needs and aspirational desires Convenient, seamless experience One checkout for all fashion needs

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February 27, 2020 Zalando Press Call 33

Zalando’s USP for Brands

Largest customer base in Europe ~31 million customers in 17 countries Key market access point > 60% of our premium customers are Millennials and Gen Z Platform services Extensive data access, fulfilment and marketing services Building bridges A great experience for new luxury customers looking for emerging designer & luxury brands

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February 27, 2020 Zalando Press Call 34

Outlook

Dedicated premium marketing & PR Known and loved for mainstream and premium / luxury fashion Luxury digital experience An onsite destination with a luxury experience Building strong partnerships Continue to be the best possible partner

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February 27, 2020 Zalando Press Call 35

Zalando Premium

Zalando Premium Goes Big

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February 27, 2020 Zalando Press Call

Q&A

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