However, late 2015 saw the etailer branch out to advertising, launching its own in-house data-driven platform that aims to connect fashion and retail brands to consumers. (…)
One of our newly launched products is our data-driven advertising unit Zalando Media Solutions. We have been an active advertiser for the last eight years ourselves and built up strong relationships with publishers, a substantial net reach across 15 markets as well as deep knowledge about factual data and campaigning.
We use this experience to open up for partners and offer creative, data-driven campaign services on a strong consumer insights basis for both fashion and non-fashion brands.
ZMS combines premium audience targeting with creative storytelling and native ad formats that enable our partners to adress the right consumers at the right time, complete with tailored brand messages on Zalando inventory and on third party sites such as Facebook or Instagram.
Bringing Zalando inventory and third party sites such as Instagram together becomes an interesting all-in-one offer for brands. Zalando, the main shop itself, is already atractive for brands. But think even further: Zalando’s mobile marketplace Fleek uses Instagram images to bring content into brand feeds and thus making Instagram images shoppable. If everything goes according to Zalando’s plans, Zalando Media Solutions could bring (for example) the brands’ Instagram efforts and their e-commerce efforts elegantly together. The distribution (or the main part of it outside the marketplace) would still sit with Instagram (and any other network) but everything else would be provided by Zalando.
Already, 80 brands are using Zalando Media Solutions, according to Cochet:
Around 80 brands have used ZMS so far for over 100 different campaigns already: Nike, Adidas but also Arcadia for Topshop, Topman, Dorothy Perkins, Boxfresh and many others.
Back in February, I wrote this about Zalando Media Solutions:
Zalando’s Media Solutions are interesting because Zalando has in its core markets the reach necessary to make an advertising play work. Being able to make money by means other than directly selling goods and keeping the margins is very powerful. (Amazon is a precedent there.)
You could say, there is a certain threshold an online retailer needs to pass for more strategy options to materialize. Once a certain size is reached things like an additional marketplace (Amazon), cross-subsidized bundling (Amazon Prime), an app centric platform (Zalando) or advertising (Zalando, Amazon Advertising Platform) become feasable.
The dangerous consequence for smaller merchants in the same market: Those options to earn money by other means give big online retailers more room with pricing.