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Zalando to Expand Loyalty Scheme to More Markets

The expansion plan comes at a time when the company reported solid first-quarter sales growth and confirmed its outlook for 2019.
Zalando logistics centre | Source: Courtesy
By
  • Reuters

BERLIN, Germany — Zalando, Europe's biggest online-only fashion retailer, said it would expand its loyalty scheme 'Zalando Plus' to France and Italy in the next 12 months, following the scheme's launch in Germany and Switzerland.

The expansion plan comes at a time when the company reported solid first-quarter sales growth and confirmed its outlook for 2019.

Retailers are looking to mimic the success of Amazon's Prime subscription service, which is seen boosting customer loyalty and encourages them to shop more frequently.

Members of Zalando Plus pay an annual fee of €19 after an initial free trial.

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H&M, the world's second-biggest clothing retailer, has also been expanding its loyalty scheme, planning to add seven more markets, including the United States, by the end of the year.

Zalando's shares jumped last month when it indicated that it expected to post an operating profit for the first-quarter, when it usually makes a loss due to selling off remaining stock after Christmas at a discount.

On Thursday, it said adjusted earnings before interest and taxation came in at €6.4 million ($7.17 million) on sales up 15.2 percent to €1.378 billion, in line with average analyst forecasts for €1.377 billion.

It confirmed a forecast for 2019 revenue growth at the lower end of the 20-25 percent range, an adjusted EBIT of between 175 million and €225 million and capital expenditure of around €300 million.

By Emma Thomasson; editors: Thomas Seythal and Uttaresh V.

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