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Interview with Heinrich Deichmann

Companies have to serve people

Once upon a time there was a shoemaker called Heinrich Deichmann. In 1913, he opened up a small shoe-making shop in the working class district of Essen-Borbeck. Today, 101 years later, his grandson, also called Heinrich Deichmann, is head of Europe’s biggest shoe trader. Over the decades, the company has constantly reinvented itself; always adapting to the latest market trends and requirements. Yet, despite all the changes, Deichmann has stayed true to its original philosophy which is based on a Christian view of the world. We talked to Heinrich Deichmann about the democratization of fashion and social responsibility for companies and entrepreneurs.

Wirtschaftsforum: Mr. Deichmann, you represent the third generation of a family enterprise which celebrated its 100th anniversary in the year before last. From your point of view: what are the crucial elements that have ensured your company’s success over the years?

Heinrich Deichmann: I believe that the most important factor has always been our dedication to understanding the needs and wishes of our customers. My grandparents and my parents always tried to meet those needs and, if possible, exceed them. Even today, this is our primary goal. Furthermore, we are a family enterprise. We believe in sustainability and reinvest our profits back into the company in order to ensure organic growth in the long run. We focus on rolling out our concept across the globe. We have encapsulated our guiding principles in our slogan which is “Companies have to serve people.” Of course, this philosophy also encompasses our employees. When our company started to grow, my father extended this view to people who are in need of help in general. Soon, he started to engage in sustainable aid projects.

Wirtschaftsforum: In just a few words – what values does Deichmann represent – and what are your company’s USPs?

Heinrich Deichmann: I can express our values in just four words: Humanity, sustainability, independence and honesty. To learn about our USPs you should talk to our customers. Our goal is three-fold: offering good quality, fashionable shoes at a competitive price.

Wirtschaftsforum: Multi-Channel Marketing is an important keyword for success today. In response to the growing influence of the e-commerce sector, Deichmann restructured its business completely. How important are your shoe shops in comparison to your online and mobile activities? What are your latest achievements and developments here?

Heinrich Deichmann: Restructuring is probably not the correct term. In 2000, we were the first in our industry to sell shoes via the internet. Since then, we have been continuously developing our e-commerce business. Today, we have 18 online shops worldwide, all of which enjoy double digit growth rates every year. To us, multi-channel marketing means making our clients the best possible offer accessible on all channels and to connect these different channels in order to achieve synergy effects. We are the only shoe trader in Germany to offers its customers an online ordering service and free returns at one of our 1,200 shoe shops. Or you can order online if you cannot find the right size in your nearest shop. Our customers can also make a reservation online and collect the shoes at the shop of their choice. There are so many options. At the end of the day, we want consumers to choose to shop at Deichmann. Which channels they use is secondary to us. Our goal is to make the best possible offer.

Wirtschaftsforum: In the past few years, Deichmann has recruited celebrities to be brand ambassadors. Among them have been well known names such as the Sugarbabes, Pussycat Dolls, Cindy Crawford and Halle Berry. What aspects are important when you are choosing a new brand ambassador? What image do you want to create or transfer to your brand?

Heinrich Deichmann: Our brand ambassadors stand for an international lifestyle. We show fashion-conscious women from different age groups in order to demonstrate that fashion and good taste are not a question of money bur are affordable for everyone. Currently, we are enjoying great success with campaigns which are launched in cooperation with international bloggers. They are offered exclusively online. Here, we target a primarily young clientele with highly fashionable and trendy items.

Wirtschaftsforum: Originally, Deichmann was a shoe-making shop. What is Deichmann today?

Heinrich Deichmann: We are an international fashion trader that is able to offer fashionable collections at competitive prices thanks to efficient supply chains. You could say we democratized fashion – in a similar way to H&M.

Wirtschaftsforum: Since you took over the management of the company, you have pushed forward Deichmann’s international expansion. What are your most important markets at present and where do you see promising growth opportunities for the coming years?

Heinrich Deichmann: Germany is still our number one market. Today, the domestic market accounts for around 41% of our global sales. Second is the USA where we have been active since 1984. Now, we have around 500 shops there. Switzerland is another key market for us. We have been active there with different formats since 1973. Altogether, our group now operates in 24 countries worldwide.

Wirtschaftsforum: What are your plans for 2015? What is your vision for the company in the long term?

Heinrich Deichmann: In recent years, expansion has been high on our agenda. Now, we have to accelerate our growth in our existing markets and consolidate our market position. In most countries there is much more potential to exploit. We will focus on the USA, Turkey and Great Britain in the first instance. We recently broke into the Russian market. We are aiming to enhance the international growth of the Deichmann Group with new formats, too. Saying this, we will stay true to our values and try to generate organic growth, without loans or external capital. We want to remain an independent family enterprise. Of course, we are keeping an eye on new markets in new countries. But we will address them when the time is right.

Wirtschaftsforum: What drives you to continue the family tradition?

Heinrich Deichmann: I grew up with the company. As a kid I watched my father managing and expanding the business. To him, entrepreneurship has always been closely tied to social responsibility. He always supported people who needed help by funding social projects or even initiating relief campaigns. He has been my guide and taught me the deeper meaning of work and of working for a company. I think I decided at a very early stage in my life to follow in his footsteps.

Wirtschaftsforum: Mr. Deichmann, please give us some words of wisdom from your experience as an entrepreneur?

Heinrich Deichmann: “Money is a good servant – but a bad master.”

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