In 2011, the Otto Group launched the Quelle brand in several European countries using various business models. Assortment priorities in Switzerland and Austria include home-furnishing goods and electronics, with fashion taking the main focus in Russia. While Quelle brand sales are far outperforming forecasts in those countries, they have lagged behind expectations in Germany.
“Positive performance in other countries demonstrates that a proprietary trading model is also more appropriate for successful operation of quelle.de in Germany than our previous marketplace approach. Therefore, in the months ahead we plan to restructure quelle.de to make it a pure brand provider with its own assortment”, says Dr Rainer Hillebrand, Vice Chairman of the Executive Board Otto Group, Member of the Executive Board, Corporate Strategy, E-Commerce, Business Intelligence Otto Group.
Since mid-2011, only retailers and brand manufacturers have been able to offer their products at quelle.de. The retailers ship the ordered products from their local depots while quelle.de handles marketing, billing and customer care. Although the team has succeeded in attracting 500 dealers to the marketplace, this business model does not meet the Otto Group’s long-term profitability expectations.
Therefore, starting in summer 2013, the Internet pure-play quelle.de will exclusively offer its own products and those from the Otto Group in its Web shop. “With this proven concept, quelle.de can define its own assortments and prices. What is more, shipping and the full customer-order process will be entirely in quelle.de’s own hands in future – to the benefit of the customer”, emphasizes Hillebrand.
In future, quelle.de will be operated by a subsidiary of the Otto Group. The Hamburg office of Quelle GmbH is expected to be dissolved at the end of May 2013. “Employment contracts for 60 employees will be terminated. Because this change predominantly concerns staff with significant e-commerce experience, we assume that these employees will find new and exciting work within the Otto Group”, says Hillebrand.
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