A year of restructuring and change

Another year gone by. I’m sure a lot of you find yourselves saying that these days. This past year was, without a doubt, an intense year for both my team and myself. It was a time of restructuring, during which we tackled a lot of challenges and introduced many improvements.

Change is the new normal – also in the beauty sector

The beauty industry has been changing at lightning speed in recent years. Our role as the leading premium beauty retailer in Europe with a workforce of some 20,000 employees spurs us on to take an active role in shaping this evolution. I spent just five years working outside of the beauty industry, and so much changed in that time. That’s likely true of very few other sectors. Douglas has always been a pioneer in mastering the transformation from a brick-and-mortar retailer to a growing online vendor. And that is why we are Number One in selective beauty e-commerce today. As people less frequently stroll through the city centers and more often fill their shopping carts online instead, we need to get even better at developing ideas to remain attractive for the customers who come and see us in person.

Well prepared both in stores and online

Restructuring, in the truest sense of the word, has been a recurrent topic in our Douglas stores, for example. Our new logo can already be admired in many of them, and customers visiting our stores will discover that a great deal of modernization has taken place. As a retail company, we cannot shrug off the decline in shopper footfalls in the city centers and focus exclusively on our successful e-commerce business. We know our customers, and we know that most of them want to test, feel and smell beauty products – and we want them to be able to do this at Douglas.

That is why we have taken care of both lines of business: of the renovation of many of our brick-and-mortar stores and also of a new, technologically enhanced user experience for our e-commerce customers.

We offer premium skin care advice and other services, such as beauty treatments, on site at our stores. In our largest European store on Frankfurt’s main shopping street, the Zeil, you can get into the mood of a relaxing holiday season with the widest variety of beauty treatments on our spa floor, for example. We want to offer our customers a unique shopping experience, and I’m happy to say that the response has been very positive. The PRO Store that we just opened in Hamburg has already received more than 20,000 visitors since the end of September, and customers are spending about 10% more there on average than at our other branches. This is a fantastic win for Douglas.

New digital benchmarks in the e-commerce business

Many of our younger customers turn to the Internet to get their initial inspirations about the latest trends. One million beauty tutorials are viewed each day on YouTube. A truly impressive number that shows just how relevant the beauty industry is. The decorative cosmetics industry will grow to a market volume of $48 billion worldwide this year, an increase of 6% (Mintel Report, 2019). The step from online beauty tutorial to online shop is not a big one. Which is why we’ve also made improvements in this area by launching a new app and upgrading our 1:1 marketing so that we can provide our customers with personalized offers.

The growth of our e-commerce business has already shown a great deal of promise in the past fiscal year. Digital turnover increased by 11% to €423 million, making Douglas the largest online provider in Europe, generating four times as much digital sales revenue as Germany’s next largest competitor. I am particularly pleased that we were able to further expand our online business in August 2018 by acquiring online retailer parfumdreams, and in this way add another brand to the Douglas family.

Stores as point of experience

Even though beauty topics are popular all over the Internet in the widest variety of formats, young people can also be infected with offline enthusiasm, especially when top influencers present their favorite products in stores – as Bella Hadid recently did in Frankfurt. We will therefore be offering more events in selected outlets in the future.

This should particularly benefit our 39 million loyalty card holders. The success of our Douglas Beauty Card is demonstrated by the fact that 67% of our sales can be attributed to our loyal customers throughout Europe.

We are active in 21 European countries. We cannot implement all the changes at the same pace everywhere, but this year we set the ball rolling in many areas and are on the right path.

Expanded assortment: from new brands to an intelligent mini-factory

Our trend scouts were busy in the U.S. and Asia. We added more than 150 new brands to our product range throughout Europe over the course of the year. Many of them online first. And some of them have become our customers’ favorite products. Four products from the newly introduced brands are now among the top 30 skincare products. I am very pleased about this, of course. My own personal product tips include the Canadian face care brand The Ordinary as well as beauty supplements from #INNERBEAUTY, which enhance external beauty from within.

We will undoubtedly continue to seek out new brands and try out new things. For example, if you visit our PRO store or our flagship store on Frankfurt’s Zeil, you can get a cream that is customized to your skin in just eight minutes, created by a kind of mini-factory for personalized skincare. Personalization is certainly one of the topics that we will continue to build on in the future. At the same time, we can’t forget about new technologies. We just need to understand them, and use them correctly and responsibly.

Teamwork always wins!

A lot has happened here at Douglas in 2018 – and we won’t be slowing down. We have laid the foundation for sustainably profitable growth. We have become faster, more agile, more modern. The fact that we’ve been able to initiate and accomplish so many things is all due to a wonderful team. My sincerest thanks to all the Douglas teams in all our stores!

Looking forward to spending 2019 with you!