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”We want to empower customers to make an informed decision”

As part of our research — The New Sustainable Consumer — where we want to create a better understanding of why and how consumers do or do not incorporate sustainability issues into their consumption behaviour. We’ve researched a large amount of existing quantitative consumer reports from around the world and conducted a wide range of interviews with industry experts. These experts have acted as our advisors, they are individuals dedicated to sustainability and add different perspectives to the research through their individual approach. The report will be presented at the Scandinavian MIND Transformation Conference 12 November.

We call them ’our voices of change’ and today it’s time to meet Kate Heiny, Director for Sustainability at Zalando, one of the fastest-growing multi-brand retailer and fashion marketplace in the world. She has worked in leading positions for sustainability at Target Corp and C&A, and has been supporting The Sustainable Apparel Coalition as a board director for six years before joining Zalando as Director of sustainability in 2019. Together with her team, she is responsible for bringing Zalando’s Corporate Sustainability Strategy to life and in driving actionable measures in becoming a sustainable fashion platform, with a net-positive impact for people and the planet. 

Kate and her team are currently relevant through Zalando’s collaboration with eight European designers to create a more sustainable capsule collection. The collection is a following of the successful launch Small steps. Big impact.. The concept has expanded to include both men’s and women’s clothing. This time, the collection has been put together by eight European brands; Closed, Designer’s Remix, Henrik Vibskov, Holzweiler, House of Dagmar, Mother of Pearl, Mykke Hofmann and Progetto Quid. The mission is to guide consumers to make better sustainable decisions when it comes to fashion without compromising on style. Read about the collection here.

Why is sustainability so important for Zalando?

— We know that the fashion industry is facing huge, complex challenges. The planet is suffering from the effects of climate change and unsustainable use of resources. Human rights and working standards are under threat. We also know that we have been part of the problem. Now we need to be part of the solution. At the same time, we know that both our current and future customer base are calling for more sustainable choices in fashion. Nine out of ten Generation Z consumers believe companies have a responsibility to address environmental and social issues. The immediate significance is clear for a customer-centric company like Zalando; we must serve the customer’s needs if we want to be the Starting Point for Fashion. By committing to sustainability, we can secure our long-term growth, stay relevant to our customers and establish market-leading differentiation against our competitors. Together with our people, partners and customers, we’ll take a stand, style with care and shape our future. 

How is this being implemented throughout Zalando mission and businesses practices 

— I think we can all agree that ‘less bad’ isn’t good enough so our ambition is clear. [The initiative] do. MORE is our vision to be a sustainable fashion platform with a net-positive impact for people and the planet. It means all of us giving more than we take. Improving our business is one part of how we achieve our vision, but it will also mean reaching further; right across the value chain. From beginning-to-end, we recognize our influence on how brand partners to source and make their products, and how our customers buy and care for them later. This is the beginning, and we’ve thought carefully about how we’ll get there. Our plan has three parts: 

1. It starts by taking a stand on the most important issues today — climate change, use of resources and worker rights. We’re raising the bar, acting first and bringing our brand partners on the journey with us.​ ​As a part of our commitment, we’re tackling climate change head-on by reducing our carbon footprint and releasing​ science-based targets​ ​in line with the 1,5 °C Paris Agreement goal. Furthermore, we are working together with the Sustainable Apparel Coalition (SAC) to set new sustainability standards for brands and retailers. ​Zalando is the first retailer ​to make sustainability assessment mandatory for its private labels and partner brands on the basis of the Higg Brand and Retail Module. By leveraging our position as a leading platform with more than 2500 brands, we can scale and promote the initiative and drive lasting sustainability improvements across the industry using a unified system of measurement. 

2. One challenge is that sustainable fashion is still not widely available, and it can be a complicated and confusing topic. We want to change that​. ​We’re making it easy for people to shop brands they want to — big and small — sustainably, while also ensuring that our customers have the inspiration and information they are looking for, all in one place. We want to empower customers to make an informed decision. Today we have over 40.000 articles flagged with sustainability from more than 650 brands. This makes up more than 10% of Zalando’s GMV, bringing us closer to our goal of growing this share to 20% by 2023. 

3. Beyond this, we want to shape our future. We’re experimenting and collaborating across the industry to create a circular fashion system. And we’ll make sure our workforce has the skills they need to thrive in a rapidly changing world. We just took a big step on our circularity journey when we recently launched the pre-owned category in Germany and Spain. This new offer caters to both, customers who want to shop and those who want to trade in pre-owned articles for credit on Zalando. All of this comes with the look, feel and unmatched convenience of Zalando, making this highly-anticipated offering available to millions of customers across Europe. The category will be rolled out to customers in Belgium, France, the Netherlands and Poland in October. 

”As a part of our commitment, we’re tackling climate change head-on by reducing our carbon footprint and releasing​ science-based targets​ ​in line with the 1,5 °C Paris Agreement goal.”

With the increase in demand for sustainable practices. Have you noticed an increase in the status of the sustainability manager in the fashion industry?

— For us, sustainability is more important than ever and in the context of COVID, the focus on sustainability has increased even more. The current crisis demands that companies accelerate their progress on sustainability initiatives in order to pave a better future for people and the planet and to be competitive in the market that will emerge from the pandemic. It simply goes hand in hand – companies need to be successful and sustainability is necessary for success​. 

If someone wants to become a successful sustainability manager that stands ready for the next normal. What guiding words would you pass on to that person?  

— First, understand your core business model. Second, understand your material sustainability issues, and third, define a clear strategy based on these priorities and with measurable goals.

What role do you think that the online multi-brand retailers should have in regard to a sustainable transformation?

— To us at Zalando sustainability means balancing economic growth with the impact we have on people and the planet. As a platform, we want to enable customers to make more sustainable choices and incentivize brands to produce the offering. With over 34 million customers in 17 markets and more than 2500 brand partners, we want to use our scale and technology to take the lead in building the connections needed to transform the industry to the better.​ ​Our collaboration with SAC is a good example of how we as a platform can use our size to scale and promote initiatives and drive lasting sustainability improvements across the industry. 

We can see a huge increase in sustainability as an image-building asset for consumers to express themselves. Is this something that you can see at Zalando?

— We know that sustainability is an important topic for our customers. As already mentioned, nine out of ten Generation Z consumers believe companies have a responsibility to address environmental and social issues. We can also see this reflected in our sales. In Q2 2020, more than 35% of Zalando customers bought more sustainable fashion and we see up to 30% higher conversion rate when products are flagged with sustainability. 

”Nine out of ten Generation Z consumers believe companies have a responsibility to address environmental and social issues.”

Can you see any changes in the sustainable consumer preferences pre- and post-corona at Zalando? 

— We have seen a steady increase in the share of customers that are buying items from our sustainability assortment, and this has continued despite the coronavirus crisis. Our internal research has shown that sustainability has become more important for 34% of our customers while 38% say that brand transparency has become more important. 

Do you know what the consumer values the most when they search for sustainable products at Zalando? How are factors like price, eco-facts, eco-storytelling, labelling etc playing a role for consumers when searching and choosing products?

— This is definitely something that we are researching in order to understand our customer’s needs even better. So far, we can see that our efforts to make it easier for our consumers to find and shop more sustainable products has led to an increased share in sales of more sustainable products (currently 10% of our GMV, our goal is to reach 20% by 2023). However, price value and fit are still the most important factors for consumers and sustainability only comes after that. 

This interview is part of our research for The New Sustainable Consumer — where we want to create a better understanding of why and how consumers incorporate sustainability issues into their consumption behaviour. We’ve researched a large amount of existing quantitative consumer reports from around the world and conducted a wide range of interviews with industry experts. These experts have acted as our advisors, they are individuals dedicated to sustainability and add different perspectives to the research through their individual approach. The report will be presented at the Scandinavian MIND Transformation Conference 12 November. Secure your free ticket to the online experience.

Kate and her team are currently relevant through Zalando’s collaboration with eight European designers to create a more sustainable capsule collection. The collection is a following of the successful launch Small steps. Big impact. The concept has expanded to include both men’s and women’s clothing. This time, the collection has been put together by eight European brands; Closed, Designer’s Remix, Henrik Vibskov, Holzweiler, House of Dagmar, Mother of Pearl, Mykke Hofmann and Progetto Quid. The mission is to guide consumers to make better sustainable decisions when it comes to fashion without compromising on style. Read more about the Capsule below.