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Authors:
Werner Reinartz (University of Cologne); Nico Wiegand (University of Cologne)
Published in:
2020
Version:
22-Aug-2020
Revision date:
25-Sep-2020
Length:
30 pages
Data source:
Published sources
Notes:
To maximise their effectiveness, colour items should be printed in colour.

Abstract

Douglas, the leading European beauty retailer, was highly successful with stationary retail of premium beauty products until the 2000s. However, since the rise of digital channels, it has been struggling with major disruptions in the beauty products industry. Consumer expectations, especially with regard to product variety, have been rising and digital channels to facilitate information search about beauty products (eg comparison portals, online feedback, social media) and their purchase became more popular. Moreover, the competitive landscape has changed significantly. New competitors have entered the German market, such as large beauty retailers from other countries, as well as pure online players. To tackle these challenges, Douglas has increased its online activities and has implemented a multi-channel strategy covering both offline and online channels. Tina Muller’s goal as a CEO has been to make Douglas the number 1 destination for beauty. In 2019, Douglas has launched a platform for online beauty appointment booking (Douglas Beauty Booking) and has opened its online shop to selected third-party sellers. Not only does the launch of DBB represent a step into a new market, the beauty service market, but these platforms also operate under a fundamentally different business model. It becomes obvious that the new business model requires different organizational capabilities and a strategy to attract enough users on the supply and the demand side and to make the platforms fit to Douglas’ positioning as a premium beauty company. Now, Tina Muller is facing pressure from Douglas' financial investor to go public, which adds the challenge of transforming the new business model into a sustainable new revenue stream. Furthermore, the question arises whether the platforms need to be developed further, how they should be positioned in relation to Douglas’ existing business model, and if the establishment of these two platforms is enough to reach Douglas’ ultimate goal of becoming the number 1 beauty destination.

Teaching and learning

This item is suitable for undergraduate, postgraduate and executive education courses.

Topics

Digital transformation; Retailing; Platform business model; Multichannel retail; Beauty and cosmetic industry; Beauty salons

Setting

The events covered by this item took place in 2019-2020.

Geographical setting

Region:
Europe
Country:
Germany

Featured company

Company name:
Douglas
Employees:
10000+
Turnover:
EUR 3.5 billion
Type:
Privately held
Industry:
Retailing, beauty and personal care

Featured protagonist

  • Tina Müller (female), CEO

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