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E-CommerceinEurope:Howtosucessfulenterachallengingmarketwithgreatopportunities?Sourcing&Product|TransportLogistics|FullServiceE-Commerce|DistributionSourcing&Product|TransportLogistics|FullServiceE-Commerce|Distribution1.TheHermesGroup(memberoftheOttoGroup)2.TheEuropeanmarket:ChallengesandOpportunities3.HowtoenterEuropesuccessfully?Slide3OttoGroupKeyFacts•Morethan60yearsofexperienceinthemailorderbusiness•E-Commercesince1995•WithEUR12bnturnoversecondlargestOnlineRetailer•OttoGroupdividedintothreepillars:multi-channel-retailing,financialservicesandsupplychainservices(=Hermes)•Biggestfashion-warehouseinEuropeanmailorderbusinessoperatedbyHermes,processingofmorethan60millionordersperyear•Morethan490Mio.shipmentssendviaHermesTheOttoGroupisthesecondlargestOnlineRetailerworldwide–HermesasservicecompanyisoneofthreepillarsofthegroupSlide420091972ThesuccessstoryofHermesstartedwithaparcelserviceinthe70iesandtheserviceoffergrowssincethenSlide5Seite5360°E-CommerceisofferedbyHermesNexTecinallrelevante-Commerceregions–Europe,USA,ChinaandRussia11,814employeesareworkingforHermesworldwideHermesistheonlyserviceproviderintheworld,whoservesthewholeretailingsupplychain2.083bn€isthetotalrevenueoftheHermesGroupin20131,300suppliersareintegratedintheHermes-networkHermesisPremiumSponsoroftheGermanSoccerLeague492Mill.ofparceldeliverieswereperformedbyHermeswithinEuropeanmarketsTheVDIInnovationAwardforhavingtheworldslargestfullyautomatedwarehouseinHaldenslebenHermesFulfilmentwoninMarch2013Hermesrealizedaturnoverofmorethan2bnEURin2013Slide6Well-knowninternationalFashion&LifestylebrandsbelongtoHermescustomers(extractofreferences)Slide7Sourcing&ProductTransportLogisticsFull-ServiceE-CommerceDistributionTheservicesofHermescoverthewholesupplychain–Full-ServiceE-CommerceisanimportantpartofitSlide8Seite8KeyFactsHermesNexTecHQEuropebasedinHamburg,GermanyTheHermesNexTecHQisbasedinGermanyandmanagedbyexperiencede-commerceexpertsTeam100E-Commerceprofessionalswithlongtimeexperienceine-commerce5.000workersinthewarehousesCEOHolgerLendner•Retailande-commerceexpertwith15yearse-commerceexperience•Strongtrackrecordindifferentmanagementpositionsforwell-knownEuropeanfashionretailers&brands•Launchandmanagementofmorethan10differentonline-shopsCOOPeterHofmann•Co-FounderoffirstWeb-EnablingCompanyinEuropein1999•15yearsexperienceine-commercemanagementforstrongEuropeanretailres/fashionbrands•Launchandmanagementofmorethan20differentonline-shops•15yearse-commerceexperience•FounderofMoonbasa.comdessous&fashion,turnoverof200USDwithhighprofitCEOHermesNexTecChinaStephenSheSourcing&Product|TransportLogistics|FullServiceE-Commerce|Distribution1.TheHermesGroup(memberoftheOttoGroup)2.TheEuropeanmarket:ChallengesandOpportunities3.HowtoenterEuropesuccessfully?Slide10Europeiswithasalesvolumeof309bn.US$in2013thethirdbiggestB2Ce-commercemarketSource:eMarketer‘sreportB2Ce-commerceinEurope,statista2014277bn.$309bn.$342bn.$433bn.$404bn$375bn.$TheEuropeanmarketNorthAmerica34%AsiaPacific31%Western&EasternEurope29%SalesShareofGlobalE-Commercemarket2013CAGR9,3%Slide11UKisthelargeste-commercemarketinEurope,followedbyGermany28%ofturnoverwasrealizedwithfashionitemsSource:eMarketer‘sreportGlobalB2Ce-commerceSales26.8999.19bn.US$53.0036.9921.5719.8017.548.897.328.986.634.38B2CE-CommerceSales2013bycountryinUS$•B2Ce-commercemarketwithgoodsinEuropegeneratedaturnoverof+309bn.USDin2013•Fashionwith28%largestsegment-everythirdorderonlinemadeforfashionitemsSlide12TheEuropeanmarketischallengingduetothecountryspecificsSource:Deals.comReport2014,statista2014,e-commerceeuropr,kexdataataglanceTheEuropeanMarket•Unequalstagesofe-commercedevelopmentwithincountries(UK/Germanyvs.Italy/Spain)•Heterogeneouse-commercelandscapewithbrandshop,platformsandMulti-Channel-Retailer•Lawrestrictionsinconsumerprivacyanddataprotection•46countrieswith23differentlanguagesandcurrenciesand16differentVATrates•Differentcultures,marketingbehavioursanddifferentwithdrawalperiodswithinEurope•Multilanguagewithinonecountry(likeSwitzerland)•Officiallanguagesforcustomercareandwebshop•Morethan200paymentmethodsandpreferences•DeliverybarriersinnonEU-countries(likeSwitzerland,Norway)GRSlide13Therearesignifcantdifferenceswithinthecountries–evenbetweenUKandGermany0GermanE-CommerceUKE-CommerceCurrency&TAXEURO19%VATPaymentPayPalPaymentafterInvoicePrepaymentCreditCardDirectDebitSofortüberweisung.deCashonDeliveryLAWrestrictionse.g.•Rightofcancellation14days•Companycanchargecustomerforreturnshipment•VerystrongdataprotectionandconsumerguidelinesCustomerCareGERMANMo-Sa8am–8pmMarketing,e.g.NLPersonalizedcontent,basedoncustomerdata,lesspenetrationSocialMediaandonlineEngagement56%25hrsonlinePaymentinUKCreditCardDebitCardPayPalOthersLAWrestrictionse.g.•Rightofcancellation7days•Returnshipmentpaidbycompany–ifnotdefinedelsewiseCurrency&TAXBritishPound20%VATSocialMediaandonlineEngagement68%37hrsonlineCheckOutIndividualadressdisplayandpaymentoptionsMarketing,e.g.NLpriceandcoupondriven,higherpenetrationCustomerCareENGLISHMo-Sa9am–6pmCheckOutIndividualadress