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  • Zalando - Europe's market leader in fashion eCommerce

    April 2013

  • Mega trend:

    Online fashion is the second wave of eCommerce, following the first wave of

    commodity products like books and electronics, with a future share of retail of > 25%

    Business opportunity:

    Online fashion offers a unique combination of high revenue potential (€ 500bn

    market in Europe) and highest gross margins in eCommerce (50-60%)

    Market leadership:

    Zalando has become the leader in European fashion eCommerce by being the

    fastest growing European company ever, with >€ 1 billion in net sales in 4th year

    Zalando is driving a mega trend, bringing fashion

    eCommerce to Europe

    2

  • • Expansion into other fashion

    categories (clothing,

    accessories, sports, home)

    • Expansion into private label

    • Subsequent geographic

    expansion across Europe

    • Zalando now active in 14

    European markets

    • Broadest product selection

    (third party brands) – not

    discount model

    • Convenient shopping (free

    shipping, 100 days returns)

    • Fast brand building

    Market:

    € 10bn

    Market:

    € 100bn

    Zalando’s path started with shoes in Germany – subsequent

    expansion into other fashion categories and countries

    3

    2008/09: Germany’s leading

    online shop for shoes

    2010: Expansion to other

    fashion categories

    2011/2012: Leadership in

    European fashion eCommerce

    Market:

    € 500bn

  • Key achievements of Zalando within

    the first four years of operation

    ① Europe’s fastest growing company with over €1 billion¹ in sales after 4 years

    • 4% market share in German shoe market (most mature market)

    • Clear market leader in European fashion eCommerce

    ② Best in class offering and operations

    • Fashion destination with the best fashion offer and shopping experience

    • Proprietary logistic infrastructure and leading IT team

    • Focused, data driven organization forcing constant optimization

    ③ Core DACH markets reached break-even in 2012 after 4 years

    • Clear path to profitability

    • Positive margin trend in all regions

    ④ Strong management team and well capitalized business

    • Motivated and experienced management team led by co-founders

    • Conservative balance sheet with strong equity ratio of >50%

    • Supportive shareholders and banks

    ¹ DACH = Germany, Austria, Switzerland. 4

  • Net sales

    (€ million)

    • 4% market share in

    German shoe market

    • New categories1 and

    countries gaining

    importance fast

    • ~ 50% of

    revenues outside

    Germany

    • ~ 50% of

    revenues in new

    categories

    ¹ Categories outside of shoes (clothing, accessories, sports, home, etc.) 5

    1 Zalando is the fastest European company ever to reach

    € 1 billion in sales, four years after being founded

    1,159

    150

    6

    510

    2009 2010 2011 2012

  • Zalando is active in 14 European markets

    with brand recognition of over 90% in key markets

    Aided brand awareness in core

    markets¹ (Percentage) Targeting total

    population of

    >400m people!

    zalando.se

    zalando.co.uk

    zalando.nl

    zalando.fr

    zalando-prive.fr

    zalando.es zalando.it

    zalando.be

    zalando.at

    zalando.ch

    zalando-lounge.de

    zalando.de zalando.pl

    zalando.no zalando.fi

    zalando.dk

    93

    94

    94

    92

    90

    94

    93

    88

    94

    91

    95

    95

    CH

    AT

    IT

    FR

    NL

    GE

    Shoes Fashion

    ¹ As of January 2013.

    Targeting

    population of

    >400 million

    6

    2

  • Private labels

    (Examples)

    Third party brands

    (Examples)

    Partner program

    • Higher availability

    • Better selection

    7

    Online fashion destination with >150,000+ styles offered by >1,500 brands

    Zalando has become the fashion destination on the

    internet with a broad assortment… 2

  • ¹ Source: SEMrush (traffic from the first 20 search results on Google for fashion websites in Germany, France, UK, Spain and Italy), ComScore (H2 2012 Europe).

    ² Source: google analytics.

    Visits per month²

    (million)

    8

    … making Zalando Europe’s most visited fashion website

    and one of the top 10 most visited retail websites¹ 2

    Mar

    Jan

    Nov

    Sep

    Mar

    Jan

    Nov

    Sep

    Jul

    May

    Mar

    Jan

    Nov

    30

    20

    10

    0

    Jan

    Nov

    Sep

    Jul

    May

    100

    90

    80

    70

    60

    50

    40

    Sep

    Jul

    May

    Mar

    Jan

    Nov

    Sep

    Jul

    May

    Zalando

    LAUNCH

    New Country:

    Austria

    Launch

    First TV spot:

    Warning

    Launch

    Clothing

    Launch Zalando

    Lounge

    Launch

    Beauty Launch

    Sport

    New Country:

    Netherlands

    New Country:

    France

    Launch

    Premium

    New Country:

    Italy

    New Country:

    UK

    Launch

    News & Style

    EFFIE Award

    New Country:

    Switzerland

    Launch

    Zalando

    Magazine

    Launch:

    Home Cooperation

    „Germany‘s next

    Topmodel“

    New Countries:

    Sweden

    Belgium

    New Country:

    Spain

    New Countries:

    Finland

    Denmark

    New Country:

    Norway

    New Country:

    Poland

    TV Spot

    Christmas

    Erfurt logistic

    center opens

    2008 2009 2010 2011 2012 2013

    >90 million website visits per month

    More than 13 million customers have ordered until today

  • Phase 1

    (2009-2010)

    Phase 3

    (2012-2013)

    Großbeeren

    (Winter 2010)

    Brieselang

    (Summer 2011)

    Erfurt

    (Summer 2012)

    Mönchengladbach

    (Summer 2013)

    • First logistics center

    established

    • Operated by logistics

    partner DocData

    • 30,000 sqm

    • First logistics center

    operated by Zalando

    • 30,000 sqm

    • First logistics center built

    to Zalando needs

    • Designed and operated

    by Zalando

    • Largest eCommerce

    logistics facility in

    Europe

    • 75,000 sqm (+45,000

    sqm expansion ongoing)

    • Second large logistics

    center construction

    • Same concept used as

    in Erfurt

    • Test operations to start

    in summer 2013

    • 75,000 sqm (+45,000

    sqm expansion option)

    9

    Phase 2

    (2011)

    • Logistics centers are located in central locations in Germany, servicing all European countries

    • Zalando is leasing land and buildings to limit capital investment

    • Combined capacity of >250,000 sqm operational / in construction (~300,000 sqm including option)

    Zalando has shifted from outsourced logistics to a proprietary

    logistics network to ensure best in class and low cost delivery 2

  • 10

    One of Europe’s leading technology teams with about 300 IT specialists

    Unique IT platform: ZEOS uses modular approach to build

    highly scalable IT platform 2

  • 2012 2011

    EBIT margin

    1 DACH = Germany, Austria, Switzerland

    • Core DACH markets1

    reached break-even after

    only four years of

    operation

    • Positive margin trends in

    all regions as customers

    are loyal and efficiency is

    improved

    • Strengthened European

    market leadership

    (added 7 markets for total of

    14 markets)

    11

    2010

    Continuous margin improvements with DACH markets

    reaching break-even in 2012 3

    -7%

    -12%

    -15%

  • Equity Ratio of >50% at the end of 2012e*

    * 2012 number is preliminary and unaudited.

    Shareholder base (equity) Banks (debt)

    12

    Management team – responsible for Zalando in three dimensions

    • Robert Gentz, Co-Founder and Managing Director Zalando as an internet technology company

    • David Schneider, Co-Founder and Managing Director Zalando as a fashion company

    • Rubin Ritter, Managing Director Zalando as a process machine

    + Extremely strong second / third level management team

    Strong management team and well capitalized business –

    backed by a hig