China is one of more than 30 countries to which Newegg plans to expand its marketplace in 2017.
Zoot, a web retailer in the Czech Republic, ships online apparel orders to a physical location where a consumer can try items on and keep only what fits.
The online apparel retail business is fraught with returns because consumers don’t get a chance to try on their purchases until items arrive in their homes. And for merchants who pay for shipping costs and allow free returns—as many do—that can mean big expenses for online retailers.
Fast-growing Czech Republic-based online fashion retailer Zoot a.g. has a novel omnichannel-like approach to selling apparel that cuts down on shipping costs and the rate of returns. The merchant, founded in 2007 as an online-only flash-sale retailer of fashion items, for the past few years has been quickly expanding what it calls its Try & Buy program.
A consumer can place an order for, say, a red dress and a pair of jeans, choose the Try & Buy option instead of home delivery, and those items will be shipped to one of 25 physical locations the retailer operates in the Czech Republic, Slovakia and Romania. Once the items arrive at the location—usually within a day via the retailer’s own staff of drivers—the shopper can try them on and keep only what she likes.
The option works well for consumers because the shipping process is quicker than home delivery, pickup is convenient, and it offers the chance to touch and feel the items before purchase. A shopper also can try on additional clothes on display in the fitting room-style store and have her size shipped to that store within a few hours.
Try & Buy works well for Zoot. Shipping items from a central warehouse to one of 25 set locations is much cheaper than shipping each purchase to a consumer’s home, then paying for returns, which before the Try & Buy option reached as high as 50% of all purchases. “In Prague, the cost of delivery is around 10 to 15 cents for Try and Buy, compared with five euros ($5.59) when you send it home and back,” says founder Ladislav Trpak.
Trpak, who spoke this week about the “Future of Fashion Retail” at the Global E-Commerce Summit in Barcelona, says the program also boosts its conversion rate dramatically in the areas where a Try and Buy location exists. “When we open a new Try and Buy, we see conversion rate at least two to four times higher in the district. The offline presence really helps drive the conversion online.”
Roughly 70% of online orders are fulfilled through the Try & Buy program, he says, and the merchant may expand its reach through other Eastern and Western European nations. It may also consider removing the home delivery option altogether, and may replace it with a premium service through which a staffer would drive a consumer’s purchases to her home, wait while she tries them on, and take back anything she didn’t want.
A few web-only apparel retailers in the U.S. have in the past couple of years opened physical stores to boost their online businesses, but their approach is slightly different. Mens’ apparel retailer Bonobos, for example, operates a handful of stores in urban areas that serve as fitting room for consumers to try on items before placing an order online.
Similar to Zoot, those locations don’t keep inventory on hand. However, Bonobos has it a bit easier since it sells its own products and offers a limited number of SKUs—about a dozen styles of pants and shirts. Zoot, on the other hand, sells 100,000 products from 250 brands, and it’s adding new limited-time sales every day.
Zoot is on track to bring in roughly 35 million euros ($39.0 million) in sales this year, up 150% from last year.
Rankings of the largest online retailers in Europe, and analysis of e-commerce trends in the region, is included in the just-released Internet Retailer 2016 Europe 500. Click here for more information.