Establishing growth in multiple countries is a risk. But getting it right can transform your business. Innovation is required to be strategically resilient wherever you are in the world. Czech fashion retailer, Zoot, discusses its recent expansion in eastern Europe.
Omnichannel fashion retailer Zoot stocks 350 brands in womenswear, menswear, kidswear and home accessories, across ecommerce sites (zoot.cz, zoot.sk, zoot.ro) and a bricks-and-mortar business that comprises 26 stores in three countries, the Czech Republic, Slovakia and Romania. In 2015 sales reached CZK450m (£12.7m). Zoot was established in Prague in 2010 by marketers Josef Havelka and Ladislav Trpák, and now has 24 stores in the central and eastern European region operating on a “try and buy” model.
The concept began in 2012 and involves stock being ordered by customers online and then sent to a store location where the customer can try on the item and buy it. Zoot also does home delivery but this model allows it to operate faster and is less expensive, as more than hundreds of daily orders are shipped every day to one place. Of the 350 brands in stock at the warehouse, 60% are ordered and delivered within 24 hours. Some items in Prague are delivered as quick as three hours of the order taking place. Goods that are not purchased, or those returned by a customer, are available to be shopped again within 24 hours.
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In 2015 Zoot launched store and website operations in Romania and Slovakia. Pavlína Louženská, head of marketing for Zoot explains how the consumer varies from country to country: in Romania, for example, customers “spend 30% more than they do in the Czech Republic since they are more trend driven, big on logos and bigger brands. They are also driven more by sales and discounts.” Romanians also use mobile devices for shopping more than the rest of eastern Europe because of faster internet connectivity.
In the Czech Republic, Louženská says “people buy clothing as something you cover your body with – it’s not fashionable”. Slovakian customers are more “conservative than Romanians but also more fashionable”. Zoot uses this insight to change its product according to customers’ cultural differences.
In the past year, Zoot’s international team has grown from 200 staff to 500, 80% of whom are based in the Czech Republic and the remainder split equally between Slovakia and Romania. Louženská says having additional staff allows the business to “travel to various conferences, connect with people from other business and find out about other businesses and their markets and challenges”. In the coming year, the company wants to enter another market, possibly in Poland. However, Louženská says, the Polish market is very price sensitive.
Zoot has three main ways to ensure that all staff across countries work in harmony. The retailer has a psychologist dubbed “the Gatekeeper”, who talks with all prospective hires to ensure they have the “Zoot team spirit and that they are able to sustain the growth of a start-up”. Therapy, both individual and group sessions, is offered to all staff.
The company drives internal conversations using social network Yammer. There are also weekly and monthly exchange programmes whereby managers from one retail store have the ability to work in another country for a fixed period of time.
Zoot Talks, a collection of presentations from various people at the company followed by a party, keep the social momentum going. Video conferences are also available for anyone to join in and contribute to.
Engagement with customers is maintained using social channels, Twitter, WhatsApp and Snapchat.
“Our customer care representatives do not have a script, just one rule: to make the customer happy,” Louženská explains. “Give them a discount or a muffin, whatever they want.” Emergency styling advice is also given on Skype. “We were inspired by [Dutch airline] KLM, which was the first to pilot social care. No matter what channel you come to, you will get served.”
Zoot’s approach to overseas success is based on a thorough understanding of the brand and its customers and how it must operate slightly differently to tackle each individual market across product and operational strategies. The strong company culture stays consistent throughout each country the retailer sells in and is based on the Zoot values, “Spreading joy and believing in what you do; understanding that every individual has his or her own style; working from the heart; and having innovation and creativity as main drivers for success.”