Burberry, the renowned British luxury fashion house, has recently announced a modest growth in its third quarter results, leaving them optimistic for the future. In the quarter ending in December, Burberry recorded a 3% increase in sales, amounting to £719 million. Despite a significant decline in sales in Hong Kong, where they were cut in half, the overall performance of the brand remained strong, largely due to the captivating collections created by Riccardo Tisci, who has been serving as Burberry’s Creative Director since March 2018. With new collections now accounting for 75% of the products available in stores, it seems that ready-to-wear apparel and leather accessories are resonating well with international customers. Burberry’s Chief Executive Officer, Marco Gobbetti, remarked, “We are once again experiencing a good quarter as the new collections have performed exceptionally well, and we have continued to increase brand perception among consumers while aligning our network with our new creative vision.”
Burberry’s recent results are part of a broader transformation strategy that was initiated in early 2019. This strategy encompasses various initiatives aimed at reducing costs, which led to a 14% increase in profits during the first half of the year. Additionally, the brand has been significantly investing in digitalization, such as the introduction of personalized chat services. While seeking improvements in environmentally friendly practices, Burberry is also focusing on enhancing its physical retail presence by opening new brick and mortar stores and renovating existing ones. One key market for Burberry’s growth is China, where they recently launched an online game called Ratberry to celebrate the Year of the Metal Rat. Another notable step in their expansion plans is Burberry’s upcoming collection, which will be showcased in a runway show in Shanghai on April 23 after its debut at London Fashion Week in February. This collection will feature exclusive designs that will only be available in the region. Marco Gobbetti stated, “This show is the latest in a series of exciting events that we plan to establish this year in China, one of our most important markets, as we enter the next phase of our transformation.” As part of their expansion in China, Burberry has also announced a partnership with Chinese tech giant Tencent to create a “social retail” concept store in Shenzhen Bay in 2020. Although specific details are yet to be disclosed, the brand has expressed that the store will offer distinctive experiences that blend the social and online lives of luxury consumers with their physical environment, encouraging interaction, sharing, and shopping. Marco Gobbetti concluded by acknowledging the uncertainties in the macroeconomic environment but expressing confidence in Burberry’s strategy and outlook for the 2020 financial year.
To learn more about Burberry’s transformation strategy and their recent initiatives, you can visit their official website.
For further information on Burberry’s partnership with Tencent and their plans for a “social retail” concept store in China, refer to this article from Luxury Society.
