Annual Report 2009/10 Excellence in Retailing - Douglas Holding

cialty retail stores forms a solid base to now link new media and sales channels. In the
second half of 2010, three top-modern shops went “online” with the Internet platforms
www.christ.de, www.appelrath.com and www.hussel.de. The Perfumeries division with
www.douglas.de and the Books division with www.thalia.de and www.buch.de have been
successful in internet selling for a number of years. Consequently, solid prerequisites have
now been created in all selling divisions to further develop the DOUGLAS Group into a
leading multi-channel provider.
In the current and coming fiscal years, the focal point of the investment activities will
continue to be on the Douglas perfumeries. Up to 65 million EUR is planned to be invested
in the opening of 50 to 60 new perfumeries, the modernization of the existing store network
and the expansion of online selling. The Douglas perfumeries aim to strengthen their
leading market position for selective cosmetics on the Internet as well.
Now that the store network streamlining program is nearly complete, Douglas can
further focus on increasing market share in the existing European markets. Therefore,
new markets are not planned to be entered in the next two fiscal years. The all-important
market is still Germany, where the stable sales and earnings performance constitute
an important pillar for the Douglas perfumeries. Since a weak performance from
some foreign markets is still likely to continue, the home market will remain a key market
in the future, too.
Douglas will become even more a “place to experience.” Here, the shopping experience
will not only count at the specialty store, but in Internet as well. By offering both alternatives,
Douglas makes the shopping experience possible around the clock and flexibly
adjusted to the respective needs of the customer. Key success factors are still the excellent
service quality offered by its employees and the first-class and exclusive product range.
Being a trendsetter, the Douglas perfumeries in Germany are considered a partner for
cosmetic manufacturers in launching new perfumery products. This cooperation is also
planned to be expanded outside of Germany.
In an ongoing price-sensitive competitive background, Douglas sees a decisive success
factor to come from increasing customer loyalty. With the Douglas Card, the company
has already established a very successful customer loyalty program, which is currently
being offered in ten countries. As part of the so-called “social media”, Douglas is already
conducting intensive online dialogs with its customers. The introduction of an “App” for
the mobile phone further enables Douglas to inform its customers about current events,
services and offers on-the-go. Moreover, the exclusive and private labels, which will be
increased even more in the coming years, strengthen customer loyalty and improve competitive
differentiation. All in all, the Douglas perfumeries are on a solid path towards a
sustained expansion of its market leadership in Europe and its presence and expertise in
the Internet in the areas of perfume, cosmetics and skin care.
The Thalia bookstores will continue to concentrate their activities on Germany, Austria
and Switzerland in the two fiscal years ahead. The focal point is still on expanding its
leading market position in German-speaking countries, to consistently move ahead with
the multi-channel strategy and to increase profitability. Correspondingly, an investment
budget of about 30 million EUR has been set aside in the 2010/11 fiscal year for the opening
of more than ten bookstores, modernizing the store network and the further implementation
of the multi-channel concept. The introduction of a new merchandise management
and information system initiated in 2009 establishes the important prerequisites for the
Management Report
Key results
Business activities and operating environment
Net assets, financial position and result of operations
DOUGLAS HOLDING AG
Subsequent events
Control system and success factors
Opportunities and risks situation
Statutory disclosures
Forecast and overall assessment
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