OTTO was founded by Dr. Werner Otto under the name "Otto Versand" on 17 August 1949. Back then, the company, which was located in the Schnelsen borough of Hamburg,Germany, only offered one product: shoes. Today, OTTO is an international trade and services group and, thus, is no longer called Otto Versand but operates under the name OTTO.

The first OTTO catalogue was published in 1950 with a circulation of 300 hand-bound copies and featured 28 pairs of shoes on 14 pages. Today, the main catalogue, published twice a year as a Spring/Summer and an Autumn/Winter issue, has a circulation of approximately 10 million copies. Furthermore, OTTO publishes various specialist catalogues. A total of about 62 different catalogues, with a total circulation of 109 million copies, are mailed out by the individual mail-order company OTTO in Germany every season. Offering a range of 130,000 articles, OTTO focuses mostly on fashion wear and textiles.

By founding the Hermes Paket Dienst [Hermes Delivery Service] in 1972, OTTO started to take direct control of the distribution of its products. In the years to follow, the company's customer service was further improved by implementing a range of innovative services. Today, the Hermes Logistics Group, an individual business unit within the Otto Group, offers nearly all services within the logistics field.

In order to ensure smooth delivery of goods, OTTO operates seven warehouses in Germany: in Hamburg (2), Karlsruhe, Haldensleben, Burbach, Ohrdruf and Hanau. Small-volume goods are despatched from the Hamburg and Haldensleben shipping centres. High-quality fashion wear, which should be transported on hangers, is delivered from the Hanau warehouse. The Karlsruhe and Burbach storehouses are responsible for medium-sized articles. The warehouses in Loehne and Ohrdruf ship large-volume articles, using a so-called "two-men handling" system.

OTTO has always had a pioneering role in the field of innovative communication. The company was the first in its industry to introduce telephone ordering; today, ordering by mobile phone, using WAP technology, is taken for granted. In the 1990s, the OTTO product line was first offered on CD-ROM, ordering via videotext was made possible, and more than 20,000 catalogue articles, including images and product descriptions, as well as 100,000 articles, providing immediate delivery details, were offered on the Internet at the OTTO's online shop at www.otto.de. Today, more than 15 percent of all orders placed with the individual company OTTO are completed online.