Where fashion grows next: Europe’s new customer equation

The European fashion and lifestyle market in 2025 is undergoing a fundamental transformation. For brands, growth is no longer uniform but shaped by a polarised dynamic: entry-price segments are expanding fastest, while mass-market categories are growing more slowly. Macroeconomic headwinds are making consumers more price-sensitive and value-conscious, while also driving cross-shopping behaviour—which increases the cost of acquiring and retaining them.

Winning in this new reality requires a seamless connection between front-end customer experiences and back-end operational capabilities. Every touchpoint, from the moment a customer discovers a brand to the post-purchase delivery and return process, must be frictionless, localised, and built on a foundation of reliability.

This report brings together proprietary Zalando data and deep customer insights (collected 2023-2025), and identifies the pockets of growth available to brands willing to adapt.

To thrive in a market trending towards consolidation, brands must embrace diversification across regions, channels, and product categories.

Our data points to distinct, high-growth segments across Europe that offer clear opportunities for expansion and market share capture. By understanding where demand is rising fastest, brands can allocate resources more strategically and unlock new segments of customers.

Fastest growing regions

While the overall European online fashion market grew 6–7% year-on-year in 2024, outpacing the total fashion market at 3–4%, substantial regional disparities highlight where brands should concentrate their efforts. Central & Eastern Europe (CEE) and Southern Europe are emerging as the fastest-growing regions, with projected Compound Annual Growth Rates (CAGR) of 9–10% and 8–9% respectively, through 2028. These regions offer fertile ground for targeted expansion, driven by local dynamics and consumer behaviour—including growing online shopping and rapid adoption of digital channels. We spoke to Zalando’s General Managers for CEE and Southern Europe to get a deeper understanding of the opportunities these regions hold for brands.

Central & Eastern Europe (CEE)

At a glance:

• Beyond Poland: 12 diverse markets, >110M people (vs. 100M in DACH, 24% of total EU population). Poland leads today, but the next growth wave will come from mid-sized markets like Croatia, Czech Republic, and Romania, with smaller but fast-rising markets such as Estonia, Hungary, Latvia, Lithuania, Slovakia, and Slovenia close behind.

• High-growth region: Smaller economies than Western Europe, but growing >5% annually, with fashion and online channels outpacing global averages.

• Smart shoppers: Over 50% use price comparison tools, marketplaces, and cashback platforms; promotions, discounts, and loyalty programs strongly influence decisions.

• Global vs. local: Consumers crave global fashion assortments, with Zalando and ABOUT YOU positioned as key destinations. At the same time, powerful local generalists such as Allegro (Poland) and eMag (Romania) remain highly competitive and set high expectations for convenience.

• Unique preferences: Cash-on-delivery is the main payment method in parts of Southeastern Europe — most pronounced in Croatia, Romania, and Slovakia — while in Poland, BLIK dominates online payments. Parcel lockers are preferred across the region, with scheduled pick-ups popular in Greece.

The online fashion market in CEE is expanding faster than the global average, fuelled by rapid digitalisation, rising internet penetration, and growing cross-border shopping. Global brands are highly desired but undersupplied: while Zalando offers around 4,500 brands in Germany and 3,000 in Poland, much of wider CEE has access to just 1,750, creating a clear supply gap. Shoppers are value-driven yet crave premium logos, with demand strongest in modern mainstream, streetwear, and sportswear. Local and insurgent brands add further depth, reflecting the region’s strong fashion heritage.

For international players, success hinges on bridging global desirability with local expectations: expanding access to brands, showing up where consumers already shop, and delivering on the region’s uncompromising standards for speed, convenience, and value.

How to win in CEE:

• Expand brand access: Close the supply gap with more modern mainstream, streetwear, sportswear, and premium logo-driven assortments.

• Be where they shop: In CEE, local generalists like Allegro and eMag remain strong, while Zalando and ABOUT YOU lead as fashion destinations. Zalando’s expansion to Greece and Bulgaria opens up new addressable audiences, underlining the region’s strategic importance.

• Match convenience standards: Adapt to local delivery, return, and payment preferences—including parcel lockers, BLIK, and cash-on-delivery. Our proprietary research provides further insight into these preferences across CEE. Parcel lockers are the dominant delivery and return method in many markets, including Poland, Estonia, Lithuania, and Latvia. In Southeastern Europe, home delivery remains important, often paired with cash-on-delivery in countries like Croatia and Romania. Consumers also vary in speed expectations and refund preferences — Polish shoppers typically expect 1–2 day delivery, while Romanian and Bulgarian customers value fast refunds. Payment methods also differ: BLIK leads in Poland, while debit and credit cards are more widely preferred elsewhere, and scheduled pick-ups stand out in Greece.

• Balance value with aspiration: Serve deal-seekers while elevating premium and exclusive collections for aspirational shoppers.

Southern Europe

At a glance:

• Low online penetration, high growth potential: Online fashion is only 23% in Italy, 20% in Spain, and 18% in Portugal, well below Germany (~30%).

• Highly engaged Zalando shoppers: 47% of Italian and 60% of Spanish Zalando shoppers are fashion enthusiasts—shoppers who love fashion and style, buy frequently, adopt trends early, and spend time and money seeking confidence to push their style beyond the mainstream.

• Offline heritage meets structural limits: Offline retail dominates in Italy, but rising store costs and a dispersed population limit reach (top 10 cities cover just 14% of the population vs. 30% in Germany). Online multi-brand retailers are a powerful lever to serve customers in tier 2–3 cities and drive growth beyond major urban centres.

Southern Europe is at a pivotal moment for online fashion growth. Italy, Spain, and Portugal combine strong headroom with distinct consumer dynamics: Italy’s structural retail limitations are pushing consumers online, while Spain and Portugal are outpacing global e-commerce growth thanks to rising internet penetration, mobile adoption, and improved logistics.

Shoppers are highly price-conscious but also value quality, durability, and style. Zalando is the go-to shopping destination for brands in the region, leading in affordable premium and above-€100 purchases in Spain—giving access to the most valuable fashion consumers. Even in markets with strong local retailers, Zalando has significant untapped potential: In 2024, only 1.2% of Zalando customers also purchased from Italy’s leading retailer, highlighting a clear opportunity for incremental reach.

How to win in Southern Europe:

• Seize the penetration gap: Expand online reach, especially in Italy, where offline shopping traditions are giving way to digital convenience.

• Unlock new audiences: Zalando’s entry into Portugal opens access to additional addressable consumers, strengthening opportunities for scale across the region.

• Exploit low overlap: Use multi-brand platforms to connect with shoppers not yet reached by local retailers.

• Balance value and aspiration: Serve price-sensitive shoppers while elevating premium positioning for brand-conscious segments.

• Adapt delivery and returns: Home delivery dominates across the region, with drop-off points preferred for returns.

• Offer regional delivery windows: In Italy, moving from uniform promises (e.g., 2–5 days everywhere) to region-specific ones—faster in major cities, longer in smaller regions—can boost satisfaction and conversion.

Meeting customers where they shop

Although the top five fashion and lifestyle players have increased their share to 31% of the online segment (up from 26% in 2022), Europe’s competitive landscape is still highly fragmented. This creates opportunities for brands to use both mono- and multi-brand channels strategically. Consumers are increasingly purchasing across multiple touchpoints, so brands need to meet them where they shop: on their brand.com to retain control over margins, data, and storytelling—particularly important for premium brands—and on marketplaces to gain reach, discoverability, localised experiences, and customer acquisition.

In Europe, with almost 100 multi-brand channels, the choice can be overwhelming. Global players such as Zalando, ABOUT YOU, and Amazon provide scale and cross-border reach, while specialist platforms focus on verticals like Beauty (Douglas, Sephora), Sports (Decathlon, Intersport), and premium fashion (Breuninger, Mytheresa). Local champions — Galaxus in Switzerland, Allegro in Poland, ASOS in the UK, Boozt in Scandinavia, and Bol in the Netherlands — are strong in  their home markets through long-standing brand trust. Bol, for example, has achieved 100% brand awareness in the Netherlands since their launch in 1999, while 75% of Polish online buyers still prefer domestic websites. Galaxus similarly pairs a broad assortment with trusted service, highlighting that scale alone is not enough for international players; success lies in diversifying across channels and markets.

Off-price as a growth lever

The off-price segment is experiencing explosive growth, expanding almost 2x faster than the broader market between 2023 and 2024. This is a direct response to macroeconomic pressures, as 70% of consumers plan to continue shopping from outlets or off-price retailers even if their discretionary budget increases [McKinsey/BoF: State of Fashion Report 2025].

Gated off-price clubs are proving to be a strategic channel for customer acquisition, as demonstrated by the fact that 55% of Lounge by Zalando customers eventually go on to make a purchase on the full-price site—while only 6% of full-price customers ever shop on the off-price platform.

As the market evolves, so too do customer expectations. Winning brands must understand and adapt to what is driving customer behaviour, moving beyond a one-size-fits-all approach to create deeply personal and localised experiences.

Untapped audiences

Two increasingly important segments—Gen Z and Silver Spenders—illustrate how shopping behaviour is evolving and highlight opportunities for growth.

Gen Z

• Discovery over loyalty: Half of Gen Z prefer exploring new brands (vs. 33% of consumers over 50), and only 29% of their wardrobe comes from a single brand, compared with 52% for older shoppers [McKinsey/BoF: State of Fashion Report 2025]

• Curated experiences: 80% feel overwhelmed by constant exposure to advertising. Brands must simplify discovery through personalised recommendations, curated edits, and guided journeys.

• Self-expression: Content, collaborations, and storytelling allow Gen Z to define their identity.

• Omnichannel presence: Meet them across mobile, social, and physical touchpoints, ensuring a seamless experience.

• Experimentation: Frequent refreshes of assortments and campaigns tap into their appetite for novelty.

• Inspiration-driven decisions: 70% of digital native customers take a purchase decision while looking for inspiration while 72% of this inspiration takes place online

Silver Spenders (50+)

• Stable, high-value segment: 53% of EU residents aged 55–74 now shop online, up 10 percentage points since 2020.

• Brand loyalty and economic resilience: These shoppers offer consistent loyalty.

• Reliability first: Emphasise trust, quality, and consistency—particularly in delivery and returns.

• Marketplace preference: Older demographics prefer multi-brand marketplaces, 17 percentage points above the EU average, making marketplace presence critical.

• Value-driven purchases: Highlight durability, craftsmanship, and timeless appeal.

• Simplified digital experience: Remove friction through user-friendly interfaces.

Across all retail categories, consumer behaviour is consistently driven by three factors: assortment, price and convenience. Delivering the right products at a competitive price through a localised and personalised shopping journey is the foundation for both converting new buyers and fostering long-term loyalty. Brands that tailor these drivers to different segments can establish a more durable market position.

High growth propositions

Let’s start by looking at the assortment. Beyond regions and channels, assortment choices are a decisive lever for growth. Certain categories are expanding faster than the market overall and represent major opportunities for diversification:

• Recommerce: projected to grow 15–18% Compound Annual Growth Rate (CAGR) over the next few years as sustainability and affordability drive adoption.

• Kids and Sports: each forecasted to expand at 9–11% CAGR through 2028, making them two of the fastest-growing apparel segments in Europe.

• Beauty: expected to grow at 6–7% CAGR, supported by strong cross-selling potential and increasing online adoption.

Sports: High passion category

The sportswear market is at a turning point. Challenger brands—smaller or fast-growing players disrupting the market—are forecast to generate more than half of the segment’s economic profit in 2024, up from just 20% in 2020. This shift signals intensifying competition between challengers and incumbents, with success hinging on innovative products, authentic brand storytelling, and the right ambassadors and channels.

• Scale and headroom remain significant: Online sports retail already holds 30% market share, yet the opportunity is far from saturated. Among Zalando’s customer base, 85% practise sports weekly, but only 25% shop for sports online — highlighting a vast pool of new customers. By making sports one of the central growth pillars, Zalando aims to offer a specialised, compelling experience that becomes the first choice for sports shoppers.

• Less price sensitivity: Sports shoppers also stand out as less price-sensitive and more willing to purchase higher-priced assortments, making them an especially valuable segment. For example, the share of running footwear sales priced over €100 has grown from around 35% in 2021 to over 70% today, showing strong demand for high-performance, high-value gear.

• The experience gap persists: While sports enthusiasts look for fun, inspiration, and style — often sharing their experiences socially — online shopping often falls short of offline. Customers demand richer journeys: 54% want detailed images, 33% videos, 32% reviews, and 22% seek expert guidance. Bridging this gap is crucial to converting intent into purchase.

• Diversification is shaping growth: Both incumbents and challengers are expanding assortments, weighing participation-heavy sports (broad customer bases) against culture-driving sports (high fan followership). Winning brands strike the right balance between direct-to-consumer (DTC) and wholesale touchpoints, ensuring reach without compromising brand identity.

A new era of affordable assortment

Fashion at entry price points (EPP) has firmly entered the wardrobes of nearly all European consumers (91% across DE, FR, IT, NL, SE, PL). Defined as the lowest price cluster for each category — sneakers < €60, jeans < €45, T-shirts < €15, dresses < €35, jackets & coats < €50, and trousers < €40 — EPP signals a structural shift towards smarter spending. Importantly, this behaviour spans all income groups: 88% of high-income consumers also regularly shop EPP.

• The rise of the “mixed shopper”: The rise of the “mixed shopper”: Almost half of consumers (48%) combine entry-price purchases with higher-priced items. These shoppers are younger, digitally engaged, and often from medium- and high-income households. They show the highest trend affinity (51%), fashion confidence (47–59%), and fashion interest (50%), making them a valuable target for brands. EPP Mixed Shoppers also have the strongest appetite for fashion inspiration (55%), even higher than Non-EPP Shoppers (52%), highlighting their potential as an engaged and style-conscious audience. Mixed Shoppers tend to cross-shop across multiple channels and propositions.

• Value over price: Price matters, but according to latest SCAYLE research conducted with 6,500 consumers, it’s not the only driver. Almost half of consumers (45%) would abandon a brand due to poor customer service. Product quality issues (35%), long delivery times (26%), and poor online experiences (23%) are also key churn triggers — showing that customers weigh the full experience when deciding what’s “worth it.”

• Proper product presentation wins: We see a 10% higher engagement rate for premium or high-quality content that goes beyond the standard presentation of products online. For video content, the impact is even greater: Customers are 3x more likely to buy the product than when just seeing images while also returning less items.  

• Opportunity and trade-up potential: EPP Mixed Shoppers often exceed their budget — 10% when shopping spontaneously, 14% for specific product categories — demonstrating flexibility and potential to trade up. While EPP plays a crucial role in converting visitors into buyers, it has only a minor impact on fostering long-term loyalty, which is more strongly influenced by brand perception and convenience factors like easy returns. There is strong potential to influence the purchase journey across all shopper groups, particularly for Mixed and EPP Only shoppers, as many start their journey without a fixed brand or product in mind.
  

In short: while EPP attracts consumers, driving conversions and loyalty increasingly depends on the way products are presented and the overall quality experience.

Convenience as tablestakes

Customers are increasingly costly to acquire and harder to keep. Between 2017 and 2022, e-commerce customer acquisition costs rose by 60% [McKinsey/BoF: State of Fashion Report 2025], while a failed first delivery carries a 70% risk of churn. In this environment, convenience is not a nice-to-have but a baseline. Why invest heavily in an acquisition only to lose the customer on the very first order?

Delivery expectations

The checkout experience is a critical moment of truth: cart abandonment is often driven not by price but by missing or unclear convenience options. Customers expect clarity and control in delivery and returns, with four factors shaping their decisions: convenience, speed & punctuality, safety & confidence, and sustainability.

• Free delivery remains king: 82% of Zalando customers rank it as the most important delivery service, consistently the top factor across Europe.

• Delivery methods differ by region: Home delivery dominates in Switzerland, Ireland, Austria, and Germany (>80% preference). In Denmark, 50% prefer pick-up points, while parcel lockers lead in Poland, Czechia, Slovakia, and most Baltic and Nordic markets.

• Delivery times and promises: Delivery times of 2–3 days are widely accepted, but customers value reliability and precision over unrealistic speed promises. In Zalando’s Sweden pilot, tailoring assortment to local needs and consolidating logistics into three fulfilment centres closer to customers not only reduced actual delivery times from 3.7 to 1.7 days, but also allowed for more precise delivery promises — driving higher satisfaction and NPS.

• Order bundling matters: Customers dislike multiple parcels per order; 45% across Europe value bundled delivery, with peaks in Italy (65%) vs. Denmark (25%). Most are willing to wait an extra 3 days for a bundled order, though on average Polish consumers tolerate only 2.4 days, compared to 3.5 days in Switzerland and France.

• Returns and refunds: Hassle-free returns and fast reimbursement are decisive for repurchase. What counts as a “fast” refund varies by market: in Romania and Bulgaria, more than half of customers expect reimbursement within one to three days, while in Finland and Ireland, 75% are comfortable waiting more than three days.

• Local carriers build trust: Many consumers prefer domestic last-mile champions, making local integration a key lever for international brands.

The evidence is clear: reliable, transparent, and locally attuned delivery and returns aren’t just services—they are decisive levers of acquisition, retention, and long-term loyalty.

Localised payments

Failing to offer local payment options is one of the fastest ways to lose a sale in Europe. A recent SCAYLE survey found that 78% of shoppers across the US, UK, Germany, France, and the Netherlands will abandon a cart if their preferred method is not available — rising to 83% in Germany and 80% in the UK. What counts as “preferred” varies sharply by market: while credit cards, PayPal, and cash on delivery remain popular, local systems dominate conversion. BLIK accounts for the majority of online payments in Poland, iDEAL leads in the Netherlands, TWINT in Switzerland, and Bancontact in Belgium.

This data underlines that convenience is no longer optional but a baseline expectation. From predictable delivery to localised payment methods and simple returns, brands must provide reliable, market-specific experiences. Building this foundation is key to driving conversion, retention, and long-term loyalty.

In short, our data shows that more than anything convenience, competitive value and relevant assortment drive purchase and loyalty, as well as increasing the likelihood of repurchase. Below you can see what drives repurchase intention across a selection of European markets:

The new customer equation is not about choosing between a great brand experience and operational excellence; it’s about recognising that they are intertwined. The most successful brands are those that embrace a diversified, data-driven, and deeply integrated commerce strategy. By focusing on personalisation, convenience, and a unified operational stack, brands can protect their margins, strengthen customer loyalty, and position themselves for sustainable growth in the years to come.

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