Otto saw a big decline in revenue prior to now fiscal yr. Nonetheless, the trading volume barely increased, because of sales from partners on Otto’s marketplace. They account for one-third of the income. Otto goals to expand its marketplace offering inside Europe.
The German distance selling icon announced this alongside its annual financial results. Within the fiscal yr 2023/2024, Otto’s revenue decreased by 8 percent to 4.2 billion euros. This performance was “still well above market comparison”, Otto refers to figures from the Bundesverband E-Commerce und Versandhandel Deutschland (bevh), which noted an 11.8 percent decline and described 2023 as a “low point” for ecommerce in Germany.
Gross Merchandising Value
In its press release, Otto highlights the positive development of Gross Merchandising Value (GMV), which increased by 2 percent to six.5 billion euros. “The slight increase in Otto’s platform sales, despite the continued crisis atmosphere in retail, makes us cautiously optimistic”, says CEO Marc Opelt. He previously referred to the platform model because the “key growth engine” of the web department store.
Platform sales make Otto cautiously optimistic.
Through the past fiscal yr, Otto expanded the variety of marketplace partners by 33 percent, to over 6,500. Together, they accounted for one-third of the revenue on the shopping platform.
European marketplace partners
Despite the long and growing distance by way of revenue on Amazon, Otto is “thoroughly positioned” with German marketplace sellers, in line with Opelt. “Now we’re preparing to open it as much as European marketplace partners.” Initially, Otto will connect warehouses of German marketplace sellers in other European countries to its platform. Starting next yr, marketplace participants from other European Union member states can even offer their products on Otto’s platform. Currently, a German VAT number is required for this.
Seller selection
Opelt indicates that Otto has deliberately chosen the European perspective: “We depend on products that meet the very best quality and sustainability standards. Subsequently, we fastidiously select who may sell their goods on our marketplace – and who may not. In the longer term, cheaply produced disposable items may also not play a job in Otto’s business model.”
‘We fastidiously select who can sell on Otto, and who cannot.’
From summer onwards, Otto will open its marketplace to additional product categories, including dietary supplements and energy technology.
