Zalando is diving deeper into high-end fashion with news on Thursday that the company is adding to its Premium offer and aims to triple the gross merchandise value (GMV) of the premium and luxury segment by 2023.
It’s beginning the expansion with labels including Moschino Couture, Alberta Ferretti, and Proenza Schouler White Label, and said it “will double its assortment of premium and luxury fashion items in the same period”.
It said the premium market is worth €38 billion overall and accounts for 9% of the European fashion market at present.
Lena-Sophie Röper, its Buying Director Premium & Luxury, said: “Premium is one of the fastest-growing business entities within Zalando. By expanding into a high-end premium profile, we make further progress on our mission to become the starting point for fashion and leverage the potential of the European premium online market.”
It’s a good time to be moving into the price category with some consumers turning away from cheap fast fashion due to its eco implications and seeking investment pieces instead. Additionally, the online share of premium and luxury fashion goods in Europe is projected to continue growing.
The company said that within its own operations, the premium category, including Wholesale and the Partner Program, grew 35% year-on-year in 2019 and it expects above-average growth to continue. It’s forecasting growth of around 30% annually in the next four years as younger customers, “who tend to shop high-to-low outfit mixes with luxury items”, embrace the premium segment.
“Zalando has the largest customer base of Gen Z and millennials in Europe. These groups are predicted to make 55% of all luxury purchases by 2025. This is very interesting for brand partners, as they can access new customers through the designer destination within Zalando,” said Röper.
At the time of writing, Zalando’s premium assortment consists of 260+ brands including Victoria Victoria Beckham, Vivienne Westwood, and MM6, and it’s backed up with specially-focused content.