Zalando vs Asos- Everything You Need To Know

Zalando vs Asos- Everything You Need To Know

The UK online retail market continues to advance. According to the Centre for Retail Research, it is worth £67 billion and continues to grow. Fashion is an industry open to different trends and upcoming brands. Several factors drive demand, making it an excellent spot for many brands to grow. Due to the growth and size of the fashion retail market, several competitors are fighting for their customers’ share of spending. Two of these competitors are Zalando and Asos. These companies are amongst the leading fashion retail brands in the industry. In this Zalando vs Asos review, we’ll be exploring everything you need to know about both brands. We’ll also touch on the marketing strategies that make them the best in the industry. Without further ado, let’s take a look.

Who is Zalando?

Zalando is an e-commerce platform famous for its sales of fashion products to people across Europe. This brand offers products from more than two thousand brands. It ranges from upcoming brands to regular and also luxurious brands. They offer new, and thrift products for all genders, and their fashion products span across different categories like pants, shoes, accessories, and more. Zalando is unlike other fashion retail brands because it doesn’t own any of the brands it sells. The brand purchases these items on a wholesale basis. 

Zalando operates its fulfillment and distribution network personally. Therefore, customers find it easy to return products they don’t like within 1-14 days without any questions. Although the brand is mainly recognized for its online presence, it also owns some physical retail stalls in Germany. It also owns a styling service called Zalon. This styling service combines artificial intelligence and human input to determine the right style for you. 

Who is Asos?

Asos is a British fashion retailer founded in 2000 by Quentin Griffiths, Andrew Regan, Deborah Thorpe, and Nick Robertson. The brand used the fast fashion business model to create its ultra-fast fashion models. As an online fashion retailer, most of its revenue comes from purchasing clothes wholesale from brands and then selling them for a profit. Most of Asos’ sales include private labels and its brand product. The main drive of Asos’ business model is short sales cycles and online mobile e-commerce.

Zalando vs Asos – Zalando History

Zalando’s headquarter is in Berline and was founded in 2008 by David Schneider and Robert Gentz. Both founders are native Germans and met on the first day of university at WHU. Over the next few years, the duo shared an apartment and tried to help each other as much as they could through school. Once they were done with schooling in 2007, they celebrated by going to South and Central America. This trip turned out to be the beginning of their business together.

Schneider and Gentz noticed that Southern parts of America didn’t have a viable social network to use back then. Therefore, they launched a social network called Unibicate that was student-focused. However, this was a bad idea because they had no coding skills and were soon out of money. Rather than call their parents, they put a call through to Oliver Samwer. He had graduated from WHU a few years before them and was relatively successful. He advised both guys not to return to South America but rather build something in Europe. Samwer also paid for their flight ticket and got a job with an insurance comparison portal he recently launched. 

Zalando’s Launch and Growth

Schneider and Gentz wanted something more stable and drew inspiration from Zappos, an e-commerce company selling shoes. The duo approached Samwer, who invested £50,000 in their plan and provided them with a team of software developers to work with. Zalando came from the Italian word ‘Zalare,’ meaning to make jokes. Although the company went live as Ifansho, it rebranded to Zalando in no time. The company started out selling flip-flops. They went to the stores, made purchases, and uploaded them on their platform. 

When other online retailers began to collapse due to the financial crisis, Zalando differentiated itself by offering free shipping and returns. The online fashion retailer also offered consumers varying payment methods. Soon, their business took off, and they were making over €50,000 in monthly revenue. They got Billionaire Erivan Haub to invest €20 million into their business, expanding into Austria. 

Over the years, Zalando reinvested most of its revenue back into the business. The brand was slowly shifting into becoming a platform instead of selling its products. This meant fashion brands could sell on Zalando. The brand would become the marketplace that brought the brand’s customers. This was a beneficial move, especially in 2020 due to the pandemic. In the future, Zalando hopes to expand into new countries, especially Eastern Europe. 

Zalando vs Asos – Asos History

Nick Robertson accepted a job as a media buyer when he completed boarding school. This position provided him with the opportunity to learn more about consumer behavior. After four years, Robertson decided to move to another agency called Carat. However, it wasn’t long before he became tired of working for others. Therefore, he decided to launch his own firm’ Entertaining Marketing’ in 1996. This marketing service helped clients with opportunities like product placement on TV. Robertson worked closely with the TV industry for years, which gave him an idea for a new business.

He wanted to create a website where visitors could buy any fashion product they saw celebrities use in their favorite shows or movies. It wasn’t till 2000 before he co-founded the venture with Quentin Griffith. The company was first called ‘As Seen On Screen’ before being shorted to ASOS. Together, Griffith and Roberson railed £2.4 million as capital and bought celebrity-linked items to place on the site. They also hired Lorri Penn, a fashion guru, for her guidance. She asked that they focus on fashion online if they wanted the highest return. 

Asos Growth

The store focused on 18-24-year-olds wanting to live the life of a celebrity. The company sold affordable replicas of items worn by celebrities. This strategy worked, and soon, sales grew for the brand allowing it to join the London Stock Exchange. Although the brand promoted fashion items from celebrities, it noticed that its owned-fashion offered a higher profit margin. Therefore, the brand launched its womenswear brand two years after. Its first profit came from an endorsement from celebrities. Soon after, the brand also launched jewelry, accessories, beauty products, and menswear. Asos continues to grow to become the largest online fashion retailer in the UK.

How Does Zalando Make Money?

This Zalando vs Asos review won’t be complete without reviewing how both brands make their money. There are many ways Zalando makes money as it continually grows as a platform fashion brands can sell on. This platform provides fashion brands with different tools to track and improve their performance. Without further ado, let’s dive into the different Zalando review streams.

Product Sales

Zalando purchases products from varying brands and then makes profits whenever they sell the product. Most of its revenue comes from the products it sells on its platform. The company identifies the trending brands and purchases their products at a competitive price to excel. The brand also runs the Zalando Lounge, selling last season’s fashion items at a discount. 

Partner Programs

Instead of being an e-commerce player, it became a top fashion marketplace. Therefore, most fashion brands sell directly on Zalando, taking advantage of the company’s millions of customers. The brands usually handle logistics and returns, while Zalando provides them with different payment processes. Therefore, Zalando makes money through a percentage-based commission for each sale on the platform. Zalando also makes money through the partner program. 

Fulfillment Services

Another way Zalando makes its money we cannot ignore in this Zalando vs Asos review is through fulfillment services. The brand has invested millions into building an effective transportation and warehousing network. Therefore, the company also makes money by offering fulfillment services to the fashion brands within its marketplace. With this solution, brands can store their fashion items in one of Zalando’s warehouses and ship them to customers from there. This saves money for fashion brands as they don’t need to build a supply chain network. It also provides fashion brands with the opportunity to enter European markets. Every time Zalando ships or stores an item for its partners, it makes money. 

Marketing Services

The brand also makes money through its advertising services. The Zalando marketing team usually creates dedicated advertising campaigns for social media channels. Additionally, they advertise certain products under the ‘sponsored’ tag. Companies looking to advertise with the brand usually pay a fixed fee. 

How Does Asos Make Money?

We also have to touch on Asos’ method of making money in this Zalando vs Asos review. It’s essential to know how this online fashion retailer makes its millions, and below are some of them. 

Prioritizing Trends

Asos makes money by making trends its top priority. The brand receives thousands of products each week, and this newness drives the business. Additionally, Asos is particular about the timing of trends. It usually waits for stores to be in stock and then launches the product in one hit. It is usually the first in the fashion industry to break trends. This timing skill helps feed the brand’s content while also placing them as a top authority in trends.

Discounting Approach

Another way Asos makes money is through the discounting approach. It partitions its reduced products in an outlet section rather than filling the main product sections with price slashes. This way, only dedicated sales shoppers will discover this section. Sometimes, Asos releases new branded products right into this section. Discounting is primarily professional, and the main dates are usually in June and December.

Less Emphasis on Menswear

Although this online fashion retailer stocks up on menswear, it isn’t the main driver for its business. Womenswear usually sells out more times than menswear sells out. The company recognizes that menswear customers shop differently from its womenswear customers. It understands the habit of the womenswear shopper and therefore focuses its innovation on women. 

Final Thoughts

In this Zalando vs Asos review, it’s clear that both brands aim to become the central meeting point of online fashion retail needs. Both brands are looking to create value for their customers while also offering value to their partners. The fashion industry is unpredictable, but both brands have remained strong financially over the years. Knowing how they make money and the brands’ history, we hope this Zalando vs Asos review better understands both brands. 

The UK online retail market continues to advance. According to the Centre for Retail Research, it is worth £67 billion and continues to grow. Fashion is an industry open to different trends and upcoming brands. Several factors drive demand, making it an excellent spot for many brands to grow. Due to the growth and size of the fashion retail market, several competitors are fighting for their customers’ share of spending. Two of these competitors are Zalando and Asos. These companies are amongst the leading fashion retail brands in the industry. In this Zalando vs Asos review, we’ll be exploring everything you need to know about both brands. We’ll also touch on the marketing strategies that make them the best in the industry. Without further ado, let’s take a look.

Who is Zalando?

Zalando is an e-commerce platform famous for its sales of fashion products to people across Europe. This brand offers products from more than two thousand brands. It ranges from upcoming brands to regular and also luxurious brands. They offer new, and thrift products for all genders, and their fashion products span across different categories like pants, shoes, accessories, and more. Zalando is unlike other fashion retail brands because it doesn’t own any of the brands it sells. The brand purchases these items on a wholesale basis. 

Zalando operates its fulfillment and distribution network personally. Therefore, customers find it easy to return products they don’t like within 1-14 days without any questions. Although the brand is mainly recognized for its online presence, it also owns some physical retail stalls in Germany. It also owns a styling service called Zalon. This styling service combines artificial intelligence and human input to determine the right style for you. 

Who is Asos?

Asos is a British fashion retailer founded in 2000 by Quentin Griffiths, Andrew Regan, Deborah Thorpe, and Nick Robertson. The brand used the fast fashion business model to create its ultra-fast fashion models. As an online fashion retailer, most of its revenue comes from purchasing clothes wholesale from brands and then selling them for a profit. Most of Asos’ sales include private labels and its brand product. The main drive of Asos’ business model is short sales cycles and online mobile e-commerce.

Zalando vs Asos – Zalando History

Zalando’s headquarter is in Berline and was founded in 2008 by David Schneider and Robert Gentz. Both founders are native Germans and met on the first day of university at WHU. Over the next few years, the duo shared an apartment and tried to help each other as much as they could through school. Once they were done with schooling in 2007, they celebrated by going to South and Central America. This trip turned out to be the beginning of their business together.

Schneider and Gentz noticed that Southern parts of America didn’t have a viable social network to use back then. Therefore, they launched a social network called Unibicate that was student-focused. However, this was a bad idea because they had no coding skills and were soon out of money. Rather than call their parents, they put a call through to Oliver Samwer. He had graduated from WHU a few years before them and was relatively successful. He advised both guys not to return to South America but rather build something in Europe. Samwer also paid for their flight ticket and got a job with an insurance comparison portal he recently launched. 

Zalando’s Launch and Growth

Schneider and Gentz wanted something more stable and drew inspiration from Zappos, an e-commerce company selling shoes. The duo approached Samwer, who invested £50,000 in their plan and provided them with a team of software developers to work with. Zalando came from the Italian word ‘Zalare,’ meaning to make jokes. Although the company went live as Ifansho, it rebranded to Zalando in no time. The company started out selling flip-flops. They went to the stores, made purchases, and uploaded them on their platform. 

When other online retailers began to collapse due to the financial crisis, Zalando differentiated itself by offering free shipping and returns. The online fashion retailer also offered consumers varying payment methods. Soon, their business took off, and they were making over €50,000 in monthly revenue. They got Billionaire Erivan Haub to invest €20 million into their business, expanding into Austria. 

Over the years, Zalando reinvested most of its revenue back into the business. The brand was slowly shifting into becoming a platform instead of selling its products. This meant fashion brands could sell on Zalando. The brand would become the marketplace that brought the brand’s customers. This was a beneficial move, especially in 2020 due to the pandemic. In the future, Zalando hopes to expand into new countries, especially Eastern Europe. 

Zalando vs Asos – Asos History

Nick Robertson accepted a job as a media buyer when he completed boarding school. This position provided him with the opportunity to learn more about consumer behavior. After four years, Robertson decided to move to another agency called Carat. However, it wasn’t long before he became tired of working for others. Therefore, he decided to launch his own firm’ Entertaining Marketing’ in 1996. This marketing service helped clients with opportunities like product placement on TV. Robertson worked closely with the TV industry for years, which gave him an idea for a new business.

He wanted to create a website where visitors could buy any fashion product they saw celebrities use in their favorite shows or movies. It wasn’t till 2000 before he co-founded the venture with Quentin Griffith. The company was first called ‘As Seen On Screen’ before being shorted to ASOS. Together, Griffith and Roberson railed £2.4 million as capital and bought celebrity-linked items to place on the site. They also hired Lorri Penn, a fashion guru, for her guidance. She asked that they focus on fashion online if they wanted the highest return. 

Asos Growth

The store focused on 18-24-year-olds wanting to live the life of a celebrity. The company sold affordable replicas of items worn by celebrities. This strategy worked, and soon, sales grew for the brand allowing it to join the London Stock Exchange. Although the brand promoted fashion items from celebrities, it noticed that its owned-fashion offered a higher profit margin. Therefore, the brand launched its womenswear brand two years after. Its first profit came from an endorsement from celebrities. Soon after, the brand also launched jewelry, accessories, beauty products, and menswear. Asos continues to grow to become the largest online fashion retailer in the UK.

How Does Zalando Make Money?

This Zalando vs Asos review won’t be complete without reviewing how both brands make their money. There are many ways Zalando makes money as it continually grows as a platform fashion brands can sell on. This platform provides fashion brands with different tools to track and improve their performance. Without further ado, let’s dive into the different Zalando review streams.

Product Sales

Zalando purchases products from varying brands and then makes profits whenever they sell the product. Most of its revenue comes from the products it sells on its platform. The company identifies the trending brands and purchases their products at a competitive price to excel. The brand also runs the Zalando Lounge, selling last season’s fashion items at a discount. 

Partner Programs

Instead of being an e-commerce player, it became a top fashion marketplace. Therefore, most fashion brands sell directly on Zalando, taking advantage of the company’s millions of customers. The brands usually handle logistics and returns, while Zalando provides them with different payment processes. Therefore, Zalando makes money through a percentage-based commission for each sale on the platform. Zalando also makes money through the partner program. 

Fulfillment Services

Another way Zalando makes its money we cannot ignore in this Zalando vs Asos review is through fulfillment services. The brand has invested millions into building an effective transportation and warehousing network. Therefore, the company also makes money by offering fulfillment services to the fashion brands within its marketplace. With this solution, brands can store their fashion items in one of Zalando’s warehouses and ship them to customers from there. This saves money for fashion brands as they don’t need to build a supply chain network. It also provides fashion brands with the opportunity to enter European markets. Every time Zalando ships or stores an item for its partners, it makes money. 

Marketing Services

The brand also makes money through its advertising services. The Zalando marketing team usually creates dedicated advertising campaigns for social media channels. Additionally, they advertise certain products under the ‘sponsored’ tag. Companies looking to advertise with the brand usually pay a fixed fee. 

How Does Asos Make Money?

We also have to touch on Asos’ method of making money in this Zalando vs Asos review. It’s essential to know how this online fashion retailer makes its millions, and below are some of them. 

Prioritizing Trends

Asos makes money by making trends its top priority. The brand receives thousands of products each week, and this newness drives the business. Additionally, Asos is particular about the timing of trends. It usually waits for stores to be in stock and then launches the product in one hit. It is usually the first in the fashion industry to break trends. This timing skill helps feed the brand’s content while also placing them as a top authority in trends.

Discounting Approach

Another way Asos makes money is through the discounting approach. It partitions its reduced products in an outlet section rather than filling the main product sections with price slashes. This way, only dedicated sales shoppers will discover this section. Sometimes, Asos releases new branded products right into this section. Discounting is primarily professional, and the main dates are usually in June and December.

Less Emphasis on Menswear

Although this online fashion retailer stocks up on menswear, it isn’t the main driver for its business. Womenswear usually sells out more times than menswear sells out. The company recognizes that menswear customers shop differently from its womenswear customers. It understands the habit of the womenswear shopper and therefore focuses its innovation on women. 

Final Thoughts

In this Zalando vs Asos review, it’s clear that both brands aim to become the central meeting point of online fashion retail needs. Both brands are looking to create value for their customers while also offering value to their partners. The fashion industry is unpredictable, but both brands have remained strong financially over the years. Knowing how they make money and the brands’ history, we hope this Zalando vs Asos review better understands both brands. 

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Zalando vs Asos- Everything You Need To Know Zalando and Asos are online retailers that offer fashion products for all. Keep reading this Zalando vs Asos review for all you need to know.
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