OTTO is well on track. For the next few years the continued expansion of the business model towards becoming a platform will be the focus of our company strategy. This means we are opening up to even more partners, will be offering even more products on the OTTO platform – and want to be by our customers’ side in every area of their lives.
The progress of our culture change is also behind this development. Testing new business ideas and concepts live with our customers instead of building long-winded theoretical con-cepts will be one of the core elements of the ‘learning organisation’ that OTTO is continually developing and becoming. An initial and very tangible example is OTTO NOW: this new start-up business model based on ‘rent-not-buy’ has gone live in just a few months and has been proving the future viability of the Sharing Economy ever since.
Voice Commerce, Augmented Reality and Artificial Intelligence – at OTTO the technological transformation is firmly embedded in our organisation. Data Analysts, Reporting Designers, Developers and Product Managers not only work in our BI and Online Marketing teams but also in various functions right across the company. Their goal is clear: use technology to provide OTTO’s customers, partners and employees with orientation in the daily digital jungle. In brief: shaping the digital future together.
OTTO recognises early on that the Internet is much more than just a new sales channel – it’s radically reshaping business as well as society itself. OTTO is also changing step by step and seizing the opportunities offered by the digital world: in 2007 the company already has 500,000 articles online, and just a year later online revenues top the traditional sales channels for the first time, with otto.de generating over 50 percent of annual revenues.
Things are moving in terms of communication too, and from 2009 OTTO can also be found on Facebook and Twitter. Back then, in Germany social networks were just beginning to gain traction. The online retailer begins to use these networks to broadcast marketing stimuli and news – and is also one of the very first companies to provide genuine customer service via these channels too. Today, social media are taken for granted as an OTTO Service contact channel.
A new marketing approach is also in tune with the times, and in 2008 TwoforFashion is the first OTTO blog to go live: the approach here is based on interesting articles and content in-stead of advertising. The concept is a great success and still is today. Via a total of five blogs and several YouTube formats, OTTO is delivering very effective content marketing.
Amongst all this, online shop technology continues to develop at a fierce pace. In 2013 OTTO programmes its own Webshop software in-house, to be able to react flexibly to the require-ments of the digital world. The very first – rather pixelly – WAP-based online shop has rein-vented itself for the smartphone screen, and from 2014 onwards otto.de is now even fully responsive and optimised for every device and application – whether PC, tablet, or smartphone. In 2017 already more than half all visits to otto.de are made via smartphones.
While ‘that Internet thing’ remains a rather obscure game for nerds, OTTO launches its first digital offers. In 1995 otto.de is launched, together with shopping offers on CD-ROM. With fully animated presenters and multimedia features OTTO is genuinely blazing a trail via the PC.
In 2000 OTTO is even reachable via the fist WAP-enabled mobile phones, before anyone has even begun talking about smartphones. It quickly becomes clear that ‘New Media’, as they are called both internally and externally, are far more than just an amusing game or an add-on service – they have the potential to trigger a genuine paradigm shift and create new business models. In 1997 online orders already represent around seven percent of the company’s over-all revenues – some 450 million Deutschmarks, with the growth trend pointing strongly up-wards.
The second generation of the Otto family lays the foundations of the Otto Group as an inter-national retail and services group. In 1981 Werner’s son Michael becomes Chairman of the Executive Board, builds businesses in France, Austria and Italy, and takes a stake in SportScheck and many other companies.
By the middle of the 1980s it’s official: Otto is now the world’s largest mail-order company. Prof Dr Michael Otto firmly anchors a sustainable approach to resources and the environment within the company strategy – and this measure is still in full force today. Michael Otto and his company, which he now accompanies from the Supervisory Board, remain committed to environmental protection and are engaged on behalf of societal initiatives.
In 1969 the company moves to Hamburg’s Bramfeld neighbourhood, after an interim period in Hamburg-Hamm, and today still has its headquarters here. The move to the new Group HQ reflects the sheer pace of growth in Werner Otto’s mail-order business – driven by new ser-vices such as the telephone-order hotline, which from 1963 sets Otto apart from other pro-viders, to the introduction of the first electronic data-processing systems that automate many processes.
In parallel to this Werner Otto structures his company more and more as a group, founding the Hanseatic Bank in 1969 to handle the company’s own payment processes, and the Hermes Versand-Service in 1972 – Otto’s own parcel-logistics company. By the beginning of the 70s revenues have topped one billion Deutschmarks, and by 1978 have tripled this figure.
A start-up since 1949 – after the war Werner Otto believes in his own ‘economic miracle’ and establishes Werner Otto Versandhandel in Hamburg’s Schnelsen neighbourhood. The very first catalogue – with 28 pairs of shoes and 14 pages – issued in 1950 is today a real-life leg-end. Order from home, and pay on invoice? The business model is a roaring success!
Business is going so well that the Otto team expands the assortment to include durable goods. From 1956 onwards customers can also order bicycles and electrical appliances. Rev-enues are now climbing at breathtaking speed and reach 100 million Deutschmarks in 1958.