Why has the average order value for beauty products on Zalando declined by 20% since the new app update?

Introduction

The decline in average order value (AOV) for beauty products on Zalando by 20% since the new app update is a significant issue that requires immediate attention. This analysis will systematically identify, validate, and address the root cause while considering both short-term and long-term implications for the product and business.

Step 1

Clarifying Questions (3 minutes)

• Looking at the timing, I'm thinking the app update might be directly related. Can you confirm when exactly the new app update was released?

Why it matters: Establishes a clear timeline for the issue. Expected answer: A specific date within the last few months. Impact on approach: Helps narrow down potential causes related to the update.

• Considering user segments, I'm wondering if this decline is uniform across all customer types. Have you noticed any differences in AOV decline between new and returning customers?

Why it matters: Identifies if the issue is widespread or specific to certain user groups. Expected answer: Variation in impact between user segments. Impact on approach: Guides focus on specific user experiences or broader app functionality.

• Given the specificity of the decline, I'm curious about our measurement accuracy. Has there been any change in how we calculate or track AOV recently?

Why it matters: Ensures the observed decline is real and not a result of measurement errors. Expected answer: No changes in AOV calculation methods. Impact on approach: If changes occurred, it would shift focus to data integrity issues.

• Thinking about product mix, has there been any significant change in the beauty product catalog or pricing strategy coinciding with the app update?

Why it matters: Helps distinguish between app-related issues and product offering changes. Expected answer: Information on any major catalog or pricing changes. Impact on approach: Would help determine if the root cause is UI/UX related or tied to product strategy.