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Dear ladies and gentlemen, welcome to the conference call of Zalando SE regarding the publication of the Q1 results 2021. At our customers' request, this conference will be recorded. [Operator Instructions]May I now hand you over to Patrick Kofler, who will lead you through this conference. Please go ahead.
Good morning, ladies and gentlemen, and also welcome from our side to our earnings call for the first quarter 2021. It's just 52 days after our CMD. Today, I'm again with our CFO, David Schroder, who will provide you with a brief strategic update, walk you through the financials of the first quarter and discuss with you our updated full year 2021 outlook.As usual, this call is being recorded and webcasted live on our Investor Relations website, and a replay of the call will be available later today.David, I will now hand over to you. Please go ahead.
Thank you, Patrick. A very warm welcome to all of you also from my side, and thank you for joining our call today.To start with, let me reiterate that we are in a strong position both strategically and financially, allowing us to capitalize on both the short and the long-term market opportunity that we are seeing right now. This opportunity is primarily driven by the continued consumer demand shift from offline to online, which has been significantly accelerated over the past 12 months and which we expect to continue, although at a slower pace also post pandemic.Fashion brands and retailers are responding to these changes in customer preferences, and many of them have made it their key priority to build and to strengthen their online business. With our vision to be the starting point for fashion and our platform business model, we are ideally positioned to serve even more customers and to build deeper relationships with them while creating significant growth opportunities for our partners. Thanks to the great work done by our teams over the past 3 months, we were able to further accelerate on our journey towards being the starting point for fashion.Now let me call out some of the highlights of this past quarter for you. First, we made some further progress towards our starting point vision by growing our active customer base to almost 42 million customers, fueled by exceptional new customer growth. Second, we introduced our customers to new exciting experiences. We further rolled out our Pre-Owned fashion offer internationally. We made it easier for customers to make informed choices when it comes to sustainable fashion, and we added an exciting new fashion benefit to our loyalty program, Zalando Plus. Third, we will continue to expand our European logistics footprint to serve our growing customer base even better by adding 5 new fulfillment centers until 2023. Fourth, we delivered a strong financial performance in the first quarter of 2021, recording the strongest top line performance since becoming a publicly listed company back in 2014. Our GMV grew by 56% year-over-year to almost EUR 3.2 billion. And lastly, on the back of our strong performance in the first 3 months of this year and strong current trading in the second quarter, we've upgraded our full year 2021 guidance significantly and now expect 31% to 36% GMV growth and an adjusted EBIT of EUR 400 million to EUR 475 million. We will dive deeper into all of these highlights during the presentation.Let's first start with the strategic topics. At our Capital Markets Day in March, we shared with you our key strategic priorities to progress towards our vision to be the starting point for fashion. We put a particular emphasis on our efforts to build great customer experiences, to create a platform that is relevant for all our partners and to become a sustainable fashion platform with a net positive impact for people and planet on the back of a unique set of infrastructure and capabilities.Today, I would like to share with you 2 key updates regarding the continued evolution of our customer experience and our infrastructure. At Zalando, we are continuing to innovate the way we engage with our customers. In the first quarter, these efforts are well reflected in 3 selected highlights that I would like to go through with you.Firstly, following the successful launch of our Pre-Owned fashion experience in September last year, we rolled this new offer out to 7 additional countries, addressing the growing customer need of decluttering crowded wardrobes and shopping session in a more sustainable manner. Customers in these markets can now sell fashion items they no longer need to receive store credit, and they can also purchase quality-checked and highly curated pre-owned items from Zalando, enjoying the same high level of convenience they are used to from other purchases at Zalando. This is another important milestone for us in moving the fashion industry from linear to circular.Secondly, we launched a new value-based browsing experience to enable more customers to shop in a sustainable manner. Our customers are now able to shop based on the causes and values they care about and more easily understand the important work that our brand partners are doing to scale more sustainable practices. By mapping our existing sustainability criteria and assortment to impact areas, we aim to break down the complex topic of sustainability into a language that everyone can understand. When customers have built that understanding, this new experience allows them to filter our assortment by 6 different sustainability causes. These are animal welfare, reducing emissions, reusing materials, extending the life of fashion, worker well-being and water conservation. Already today, customers can discover more than 100,000 sustainable fashion items and almost the same number of pre-owned fashion products.Finally, we added an exciting new fashion benefit to our loyalty program, Zalando Plus. The new benefit allows Zalando Plus members to shop limited collections at Zalando ahead of everyone else. With the new and enhanced Plus experience, we make Zalando Plus even more attractive for both our customers and partners: for our customers, as they get earlier access to the latest and greatest product launches; and for brands, since it offers a great opportunity to engage with our best customers and to build deep and lasting relationships with them. To celebrate the launch of this exciting new feature for our Plus members, brands such as PUMA, HUGO BOSS and Levi's will give our most loyal customers in Germany early access to the latest collections throughout May. Going forward, we will offer our most loyal customers even more early access benefits, such as early access to sales and to Zalando Lounge campaigns.We remain convinced that these and similar efforts targeted at deepening the relationship with our customers will bring us closer to being the starting point for fashion for more and more customers across Europe.To serve our customers even better and to enable our growth trajectory and the growth ambition of more than EUR 30 billion in GMV by 2025, we will expand our European fulfillment network. Today, we already operate 10 sites across 5 countries in Europe. This year, we will add 2 more sites in Madrid and Rotterdam to get closer to customers in Spain and the Benelux region and to further increase our fulfillment capacity to EUR 14 billion in GMV. As already communicated at our recent Capital Markets Day, we plan to build at least 7 new fulfillment centers between 2022 and 2025 to enable our EUR 30 billion GMV growth ambition. And I'm excited to announce today that we are starting the construction of 3 new fulfillment centers in France, Germany and Poland in the next 12 months. These 3 fulfillment centers will go live in 2023. They will allow us to offer our customers an even faster, more sustainable and more convenient delivery experience, with a particular focus on Zalando Plus customers.At the same time, we will continue to leverage a combination of state-of-the-art automation technology and our own proprietary warehouse and network management systems to drive both quality of service and efficiency. Once these 3 warehouses are fully ramped up, our network will be able to handle about EUR 18 billion in GMV, getting us closer to our 2025 growth ambition.This concludes our brief strategic update for today. Let's now turn to our Q1 financials and start with a more detailed look at our top line growth. Group top line growth in the first quarter came in at an exceptionally high rate, with GMV growing by 55.6% year-over-year, significantly above our full year 2021 guidance. I would like to particularly highlight that we were even able to accelerate our growth in the first quarter, even when we adjust for the relatively low comparables of the first quarter in 2020 as evidenced by a 2-year CAGR for the first quarter of 34% versus a 2-year CAGR for the fourth quarter of 31%. Growth was fueled by a continued shift in customer demand from offline to online, outstanding growth in our Partner business and a very strong performance of Zalando Lounge.In the first quarter, we were again able to more than double our partner GMV compared to the prior year. This also explains, to a large degree, the gap of around 8.8 percentage points between GMV and revenue growth, which is particularly well pronounced in the DACH region where the platform transition is most advanced.Now let's take a look at the development of each of our segments. Our core sales channel, Fashion Store, saw GMV grew by 54% GMV year-over-year in Q1 across both regions. For the first time ever since our IPO in 2014, the DACH region was able to outperform Rest of Europe with a remarkable GMV growth of 54.6%, particularly driven by our most mature and home market, Germany, growing well ahead of the group supported by a stellar partner performance.Rest of Europe grew very strongly as well, with 52.7% GMV growth. Growth in Rest of Europe continued to be particularly strong in Southern Europe and Eastern Europe, supported by the ongoing strong new customer acquisition and reduced churn.Furthermore, we saw a very strong performance of our Offprice segment in the first quarter, recording GMV growth of 76.5% year-over-year, driven by our flash sales destination, Zalando Lounge. Thanks to a highly engaged customer base.The Other business segment grew strongly as well, driven by a particularly strong performance by Zalando Marketing Services, where we saw a strong demand from fashion brands, resulting in an external revenue growing by around 80% year-over-year. Besides using ZMS to drive sales on the platform by increasing visibility, our partners started to invest more again in branding campaigns to build their brand equity on Zalando.Looking at our key customer metrics, you can observe a very positive trend in all of them. Active customer growth continued to accelerate to almost 31% year-over-year, the highest year-over-year growth since 2013. We now count 41.8 million active customers. This development was fueled by a high share of retained customers and an ongoing strong new customer acquisition during the first 3 months of the year.Customer order frequency reached a new all-time high of 4.9 orders per active customer over the past 12 months, which is a great result considering the significant inflow of new customers over the past few quarters. Average basket size again showed a positive development, increasing by 2.7% year-over-year, driven by a change in product mix and a lower return rate. As a result of these order frequency and basket science developments, GMV per active customer continued to grow by 7% over the last 12 months.Let's now turn to profitability. In addition to a very strong growth momentum, we recorded an exceptionally strong adjusted EBIT of EUR 93.3 million in the first quarter, representing a 4.2% margin, almost a complete reversal of last year's picture, which was heavily impacted by an extraordinary inventory write-down to respond to pandemic-induced demand challenges and uncertainties. The strong performance was enabled mainly by the strong top line performance and an ongoing lower return rate as a result of a change in our category and customer mix.When looking at the regional profit distribution in our core Fashion Store segment, we can see that our most mature market in the DACH region delivered remarkably strong absolutes as well as relative profitability, also supported by a higher partner business share.Rest of Europe profitability came in close to breakeven in the first quarter of the year, driven by continued over-proportional investments into customer acquisition efforts to drive growth and market share gains in these countries. Offprice and Other businesses also increased their profitability, both in absolute and relative terms year-over-year.Let me now give you more detail on cost line developments that led to the positive development of profitability in the first quarter. Our gross margin showed a strong year-over-year uptick of 5.5 percentage points in the first quarter as we lapped last year's EUR 40 million write-down on spring/summer merchandise in response to the initially revised sales expectations as the first wave of COVID-19 infection hit Europe. Additionally, gross margin benefited from a very strong sell-through rate of fall/winter items and an early start into the spring/summer season.Our fulfillment cost ratio improved year-over-year as a result of a higher level of utilization, driven by the strong business volumes and improved order economics, benefiting from a lower return rate. Our marketing cost ratio decreased slightly year-over-year as a result of strong organic demand and generally high business volumes, while we remain focused on customer acquisition as evidenced by the absolute marketing spend increase of around EUR 50 million year-over-year. Last but not least, our administrative costs improved year-over-year as a result of increasing economies of scale. Turning to cash-related items now. We recorded an increased net working capital year-over-year. The main driver behind this development is a relatively stronger increase in receivables and in inventories compared to payables, reflecting a generally strong business volume and deliberately prepone spring/summer 2021 inbound. This puts us in a good position to meet the ongoing strong demand. CapEx spending is in line with our plan, but below last year's level, with all major projects well on track. Mainly due to the strong increase in net working capital, we recorded a negative free cash flow of minus EUR 142.7 million for the first quarter, up from minus EUR 302.6 million in the prior year period. As a result, our cash balance at the end of the first quarter amounted to EUR 2.1 billion after returning EUR 375 million of our revolving credit facility, which we have drawn down last spring as per the end of the first quarter of 2021.Let us now conclude and look to our upgraded outlook for the full year. When we shared our full year outlook with you earlier this year, we expect that the strong consumer demand and platform dynamics that started to unfold in 2020 to remain in place for the first half of 2021, allowing us to leverage our platform business model to continue to grow at an accelerated pace. This expectation has clearly materialized and is very well reflected in our exceptionally strong and better-than-expected Q1 results. And while we will be comparing ourselves against a much stronger baseline starting in Q2, we continue to observe elevated growth levels, driven by strong new customer growth and a high engagement of existing customers.We regard this as a potential early indicator that customer sentiment is improving and resulting in a stronger demand for fashion overall, following the gradual reopening in many European countries. Although significant uncertainty remains with regards to the further evolution of the pandemic throughout this year, we continue to assume a gradual return to the new normal in the second half of the year.Based on the stronger-than-expected start to the year, the continued strong demand momentum in Q2 and the stable outlook for the second half of the year, we therefore upgraded our full year outlook as follows: for GMV, we now anticipate GMV to grow between 31% and 36% for 2021; for revenue, we expect revenue growth to trail GMV growth as a consequence of an accelerated transition towards a platform business model and an increasing partner program in connected retail share, resulting in revenue growth of 26% to 31%; for profitability, we now expect adjusted EBIT in the range of EUR 400 million to EUR 475 million, reflecting the strong business performance year-to-date, our upgraded growth expectation for the rest of the year and higher-than-expected temporary return rate benefits. On cash-related items, we maintain our previous net working capital and CapEx guidance and plan to invest EUR 350 million to EUR 400 million to fund our ongoing investments into our European logistics network and into our technology platform. Let me close this presentation by reiterating that based on our vision to be the starting point for fashion and on our strategy to transition to a truly sustainable platform business model, we are ideally positioned to capture the immense opportunity ahead of us, serving even more customers, building deeper relationships with them and creating significant growth opportunities for our partners.That concludes our presentation. Let's now turn to Q&A.
[Operator Instructions] And the first question is from Rocco Strauss, Arete Research.
Two questions for me, please. One on return rates, So if I understand that correctly, you are seeing a benefit from lower return rates due to the product mix. On the one hand and on top of that, you're seeing faster return times during lockdown. So is there any way to kind of like break down how much of the 2 drivers are actually structural, means driven by Zalando making returns easier, more efficient size guide, repeat orders of same brands, et cetera, versus kind of like COVID-19-related effect or impact here?And the second question, maybe a bit slightly off topic. With the current launch of Apple's ATT framework or the duplication of idea base, are you expecting any material changes or impact on customer acquisition spend? Maybe help us to understand a bit better where you generally acquire new customers versus people or new customers organically joining the platform.
Sure. So starting with your return rate question, I think it's correct that the 2 key drivers are the change in customer mix and in category mix. In customer mix, we are seeing a higher proportion of new customers, which historically have always shown lower return rates than existing customers since they first need to get to know the proposition and fully take advantage of it. And on the category side, we continue to observe consistent customer behavior in the sense that need-based categories such as leisure wear, sports, kids, beauty outperform whereas occasion-based categories like dresses, which traditionally have shown some of the highest return rates, are still not yet up to pre-COVID levels. And these are really driving the return rate impact, and so it's fair to say that we regard both of these as temporary, right? So the new customers, sooner or later, will adopt similar return patterns as the existing ones. And also the category mix should resume and be back to normal as soon as the pandemic is over.What is also true, however, is that our continued efforts to improve the experience and to help customers, for example, with size and fit already led to structural decreases before the pandemic hit us. And that's a trend that we expect to continue also once this pandemic is over. And another trend that we've obviously observed in the past is that the regional mix has a positive impact on the return rate. So we started obviously with a considerably higher share in DACH. And as Rest of Europe grows in proportion, that also should continue to deliver a more structural benefit to the overall group return rate.Now then moving on to the question regarding Apple's new version of iOS and the increased focus on privacy. I think, first of all, it's important to understand that also we care a lot about our customers' privacy. It's actually something that we've invested a lot in to give customers full control of the data -- of their data on Zalando. They can choose how much they want to share with us. They can also share more with us if they want in terms of the brands they like or their size profile. And so it's really up to each customer to make that decision on how much data they want to share to potentially take full advantage of the proposition that Zalando can offer. When we then look at Apple's decision, we don't expect a major impact on our business. Yes, there might be a slight efficiency impact in our marketing. On the other hand, I think you should also consider that we can leverage a very well-known brand with very high brand awareness across Europe, and that we are not completely dependent on only performance marketing channels to drive customer acquisition and customer retention.On the second half of your question, where we get customers from. I think new customers, we definitely acquire online via channels like Google and Facebook, but increasingly also via additional platforms like TikTok. And in the off-line world, I think it's a mix of TV and out-of-home campaigns that we've seen working well for us.
The next question is from Anne Critchlow, Societe Generale.
I've got 2 questions, please. The first is which countries are you seeing the strongest move away from lockdown categories back to a more normal product mix? And then secondly on partner program. It seemed that partner program was very strong in the first quarter. Was that just driven by an increase in options for partner program product on the site? Or is there something else to mention as well, please?
Yes. So I think right now, it's probably a bit too early to talk about reopening or full recovery. I think most of the countries, as far as I know, are still in some sort of lockdown or at least stronger restriction. Obviously, some of the countries that we serve are a bit further ahead. So if we look at the U.K. or also parts of the Nordics or recently also the Netherlands, some of the restrictions are lifting. However, we haven't seen a major impact yet on the category mix. So I think that's something that should start to become more visible in the second half of the year when we gradually return to the new normal.On partner program, I think what is really driving it is, first of all, the consumer demand shift, right? So with consumers turning to online and very high numbers and preferring that channel, also brands and retailers are more active online and leverage our platform to pursue that opportunity. So when we look at partner activity, all partners have been very actively trading in the first quarter, both on the old season and the end-of-season sale, but also then with the new season. In Connected Retail, we've been able to continue to acquire hundreds of new stores over the course of Q1. And so I think it's driven equally by a higher number of partners and retailers joining the platform, but also by existing partners and retailers becoming more active.
The next question is from Andreas Riemann, Commerzbank.
Two questions around Connected Retail. What was the development of Connected Retail, particularly after you started to charge fees? I guess, that started in April. And the second question, also Connected Retail. How far away are you from a scenario where the off-line retailers can actually show their inventory on Zalando website? These would be my 2 questions.
Sure. So I think you rightfully point out that in Connected Retail, we took a deliberate decision to completely waive all commissions in the first quarter. And starting in the second quarter, we started to charge commissions again, not the full commission, though. It's rather something in between no commission and the full commission. And we expect to return to the full commission only for the second half of this year. What we have seen as a reaction is -- yes, something that we are really happy about because only a handful of stores left the platform, and so we haven't seen any churn. Really, if you consider that, we already reported more than 3,400 stores live on the platform. I think a handful of stores gives a clear indication that there's no churn issue. And I think it's on the opposite that Connected Retail continues to perform very strongly, continuing to deliver more than 10% of our GMV in Germany and also picking up significantly in the new countries that we are rolling out into.On the second question, showing inventory on Zalando. I mean, obviously, right now, it's still mainly the case that customers -- that the store, sorry, offer the inventory that we would otherwise also offer on our platform, but might be sold out in or just allow us to offer higher quantities of that same product. But it's definitely already possible today that also Connected Retail partners can list additional items. The only thing that they would then need to contribute is their own content, right? So what we cannot offer for them, at least for now, is that we then provide the pictures and the product descriptions. So similar to other partners in the partner program, they would then need to contribute that type of content. But we are working on solutions of how we can maybe even make that easier for them in the future because, obviously, we want to take full advantage of the inventory, especially in international markets, where I think one big advantage of scaling Connected Retail for us can be to offer even more local brands that we haven't fully available on our platform at the moment.
The next question is from Georgina Johanan, JPMorgan.
A few, please. The first one, just on partner program share in the quarter. Apologies if I misheard, but I think you said it more than doubled. But just on my numbers, that would imply about a 20% share of Fashion Store GMV, i.e., going backwards versus H2 last year. So I just wondered if you could perhaps correct my math on that if I'm wrong, please.My second question was on ZMS, I think you said that it was up over 80% externally. I was just wondering if you could explain, perhaps provide a reminder of kind of what else goes into that line, and therefore, what was growing less strongly than that, please.And then just finally, thank you for sharing your comments on Q2 so far being elevated. I was just wondering if you could provide a number on that and perhaps a 2-year CAGR because I think, perhaps you're still cycling some more subdued growth at the start of the crisis last year. But any color would be helpful.
Sure. So I think on the partner program share, I'm afraid I can't tell you so much. I think we'll stick to our usual practice of sharing that not every single quarter but only in some larger intervals, at least once a year, for sure. But I think what I am happy to confirm is that what I said is that the partner program GMV doubled year-over-year, and I think that definitely should obviously point to an increase in share as well because the business obviously didn't double. And so I think you can definitely trust your math that the share has increased. I'm happy to confirm that.On Zalando Marketing Services, yes, the external revenue grew by roughly 80% year-over-year. And that's also, I think, for us, the most important metric to look at when we consider the development of ZMS. There is another portion of ZMS revenue, which is related to internal services. So ZMS also acting as a marketing agency for our own business. And therefore, if you look at the overall revenue numbers, you will see that reflected as well. But I think for the purpose of evaluating the success of ZMS with partners, which I think is the main thing we care about, the external revenue is the most important KPI, and that's why I commented on it.With regards to Q2, obviously, we should all understand that we just have 1 month under our belt and 2 more months to come. But I think we made it clear also during the presentation that the quarter is off to a good start. We saw continued strong traction in April. Remember that April, though, was a month last year where we saw acceleration. So it ended much stronger than it started. So I think it's also probably a month where you would still expect strong growth. But what makes us particularly happy, that we also have a good indication that, that strong growth continues in May and June now. And so for -- to give you an indication, I think for the full quarter, it's fair to assume that we will see GMV growth somewhere in the high 30s for the year-over-year revenue, more in the low 30s due to the platform effect. And on the profitability, I think it's fair to assume that we won't have as many savings on marketing as we had last year when we hit the brake. So there, I would assume a more normal marketing cost ratio. And so I think on profitability, we should see, yes, a margin that is fairly close to what we delivered in 2019 before the pandemic hit.
The next question is from Simon Irwin, Crédit Suisse.
You've obviously given us a bit more color on the DCs. Just relating to timing, firstly, should we see an acceleration in CapEx next year as you build these up? And secondly, if you're not opening any new facilities last -- next year, which I think was what you implied, should we get a decent year of leverage out of distribution if you've got no preopening and really a relatively small amount of facilities ramping up?
Sure. So I think it's fair to assume that the massive build-out program that we talked about in our presentation, especially the parallel development of 3 new sites, all starting construction in the next 12 months, will also be reflected in the CapEx development. I think it's fair to assume that in 2022 and in 2023, we'll operate at the top end of our mid-term CapEx guidance. Just to -- just for you to recall, I think we communicated 3.5% to 4.5% of revenue as a mid-term CapEx range. And so I think it's -- it should be assumed that we will be fairly close to that 4.5% of revenue in the coming 2 years due to this build-out program. On your second question regarding OpEx impact and whether we will benefit from the fact that we won't open new facilities next year. I think on the one hand, yes, so a new facility is ramping up obviously, typically are less efficient than if the network is fully utilized. I would nevertheless caution about an expectation that this will materially impact our fulfillment cost development next year because what we announced today is all these new facilities that we are going to build. But in order to bridge the time until these new facilities open in 2023, we are already investing into brownfield facilities as we speak. And these brownfield facilities are typically coming with significantly less efficiency than the highly automated new facilities that we built. And so I think both these effects will essentially cancel each other out, and we will not see a major impact on the fulfillment cost development.
The next question is from Nizla Naizer, Deutsche Bank.
My first is on the impact of the lower return rates in Q1. David, could you help us sort of understand what the absolute impact might have been in Q1 to your EBIT as a result of those lower returns? Would it be the similar magnitude as what we saw in the last couple of quarters in 2020 or was it lower, a double-digit range? Any color there would be great. And would you be expecting a similar sort of impact in Q2 given that conditions on the ground have not changed?My second question is on your customer profile. A year after the pandemic, has the customer profile for Zalando changed in any way, i.e. has the age group changed? Any color you can give us on the type of customers who are now shopping online at Zalando would be great.
Sure. So on the return rate, I think what I can provide in terms of additional color is that in the first quarter of the year, we saw a mid-single-digit improvement in the return rate compared to, yes, last year, and that led roughly to a double-digit euro million benefit in the first quarter. I think what we're seeing, though, as well is that -- and if you look at the year-over-year improvement in return rate in Q1, that is already lower than the year-over-year improvement in return rate that we saw in Q4. And so we are seeing this gradual return back to more normal return rates. It's just happening at a slower pace than what we would have expected. And therefore, yes, there's going to be some benefit in Q2 as well. But if this trend continues, it should actually continue to fade over time.On customer demographics, I think the most notable effects that we've seen over the past 12 months is that if we look at the new customers we acquired, we've been -- we've seen very strong customer acquisition, particularly in Southern Europe. So many new customers from France, from Spain, from Italy. In terms of gender, I think we've seen an increasing share of male customers, although Zalando remains predominantly used by female customers. And we've also seen an uptick in the number of younger -- or the share of younger customers joining Zalando, which obviously makes us happy because those are the customers that we can acquire very early on and then get a great customer lifetime value out of over the coming years and decades.
The next question is from Jurgen Kolb, Kepler Chevreux.
Two questions. First, on this new collection where you can offer early access. How many of your brands are participating? Is there a first round and a second round? Just in general, on what -- in what also speed you're going to have these early accesses?And secondly, you mentioned that the new distribution warehouses will especially have or make it better for the Zalando Plus customers. Is that related to same-day delivery, i.e., are you also planning to maybe do more by yourself on the same-day delivery? Or is that more on sending the packages or the parcels in 1 goal, especially to the Zalando Plus customers?
Sure. So I think we are very excited about this early access benefit because I think it's -- yes, it's great for customers, but it's also great for brands. And that's why we are not surprised that also, as we launched the service, many well-known brands like PUMA, like HUGO BOSS, like Levi's were interested in being part of these launch campaigns now already in May. Please also remember that we actually already ran a similar pilot to understand how this type of offer would resonate with customers in the past year, together with Nike. So it's clear that, yes, especially also very well-known and attractive brands are interested in that type of solutions, and it allows them to really target and focus their most attractive products on the most attractive customer segment. And that's why, actually, ideally, we would want to offer these types of special campaigns and products to Plus customers on a continuous basis, and we will be working closely together with our whole brand portfolio to make sure that we have a very attractive calendar throughout the year of these types of campaigns. And on the delivery question, I think, yes, the overall networks and the build-out of the network serves 2 purposes. First of all, it should enable the growth of the company and essentially support all the volume that we sell on our platform and also support our partners with ZFS. But especially when we think about new locations and also further improving our processes, we've put a key focus on Plus customers where we definitely want to increase the share of same and next-day delivery offers even more going forward and where we also want to offer even better, more sustainable delivery option. And that can include also our own last-mile services in metropolitan areas, something that we have started doing already, mainly in Germany but also in selected other cities. And that has worked very successfully for us. So I think you shouldn't be surprised if we continue to do that in more and more metropolitan areas across Europe in the future.
And this concludes today's Q&A session, and I hand back to the speakers for closing remarks.
Thank you, everybody, for joining today's Q1 call. If there are any open questions, do not hesitate the IR team. Otherwise, stay healthy, and yes, talk and speak to you soon. Bye-bye.
Ladies and gentlemen, thank you for your attendance. This call has been concluded. You may disconnect now.