Zalando has announced the acquisition of Kickz, a German chain of streetwear and sneaker shops, for an undisclosed amount. The big European e-tailer said the acquisition is to further strengthen its position in the sports and lifestyle segment, especially in the basketball category. It will also allow Zalando to address a specific type of consumer who doesn't necessarily order from a generalist website like its own.
The transaction is subject to clearance by the German and Austrian competition authorities because of local regulations and the strong position that Zalando has achieved in those two markets. The deal is expected to close in the first half of this year. Founded in 1993 in Munich by Christian Grosse, who will continue to run the operation, Kickz operates 15 physical stores in Germany, including A1 locations in Berlin, Hamburg, Cologne and Stuttgart. It also has its own web store, with dedicated sites in Germany, Austria, France and the U.K., and a global e-commerce platform with a strong presence in other parts of Europe as well as the U.S. Its turnover amounted to €41 million in 2015.
Zalando's blog indicates that it wants to become a leading player in the European basketball market, creating a unique and exciting shopping experience though its technology, logistics and marketing. It wants to use Kickz' expertise in the segment as a platform to build up a curated range of basketball products and sneakers, including some exclusive items, that can be ordered from anywhere in Europe through Zalando. It wants to provide “exciting content in a dedicated basketball world within Zalando curated by Kickz.”
According to Zalando's blog, Kickz launches new products every month, and some “sneakerheads” even camp in front of the stores to get them. As our readers know, Adidas and other sports brands often launch hot, limited editions of sneakers in collaboration with sports, music and fashion celebrities that run out very quickly.
Aside from its wish to cater to a very specific audience, Zalando's latest move can be described as a further step offline by the leading fashion e-tailer in Europe, which is also playing an important role in the sale of sports shoes and apparel. It has been cooperating since June in an experiment with Adidas in Berlin, allowing customers in the city to order products through a Zalando app and to get them delivered from Adidas' inventories on the same day. It has been working in similar ways with various physical stores, acting as their online marketplace.
Zalando has lately been operating three loss-making physical stores on its own in Germany, but it has been using them mostly as factory outlets and as a showcase for its private label products. At an interesting forum discussion organized together with Adidas about omni-channel retailing during the recent Ispo Munich show, David Schneider, founder and chief executive of Zalando, said that online doesn't necessarily kill offline, and he gave as an example the acquisition of the Bread & Butter show by his company as a way to reach out to consumers through a physical event.
