Otto, who was born the son of salesman near the German capital but later moved to the northern port city of Hamburg, died last Wednesday in Berlin, the Otto Group said in a written statement.
"Werner Otto was among the last of the economic pioneers of the post-war period...," the statement said.
He had dreamt of becoming a writer but in 1949 he launched his first mail order catalogue offering shoes.
During the 1950s and 1960s when Germany was in the midst of rebuilding itself after World War II, the mail order catalogue business flourished and Otto's business grew into an empire.
The group, which has remained a family business and is run by one of Otto's sons, posted more than 11 billion euros ($14 billion) in sales last year and employs some 50,000 people in about 20 countries.
Its activities have extended to include over-the-counter retail as well as financial services.
Otto Group owns US furniture and home decor chain Crate and Barrel, and holds a 51-percent share in French mail order company 3 Suisses International. It is also a majority shareholder in online toy retailer myToys.
Otto catalogue is the sole survivor among three big German mail order catalogue companies. Quelle closed in 2009 while Neckermann only operates now as an online boutique.