Burberry uprise and downfall

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Burberry uprise and downfall

  1. 1. 01 Burberry Marketing Strategy: Failure and Revitalisation Group Members: 0517504 0625284 0625290 0519593 0525607 0509508
  2. 2. <ul><li>Objectives, Background – Arafat </li></ul><ul><li>Mistakes in Marketing Strategies, </li></ul><ul><li>Brand model, Ansoff Matrix – Inga </li></ul><ul><li>Failures – Anna </li></ul><ul><li>Revitalisation, Lifecycle – Rashid </li></ul><ul><li>Maintaining Success – Stacey </li></ul><ul><li>Regional revenue, marketing strategies – Tim </li></ul><ul><li>Conclusion – Arafat </li></ul>Contents 04
  3. 3. <ul><li>Identify the mistakes in Burberry’s marketing strategies/what went wrong </li></ul><ul><li>Identify the measures that could have been taken to preclude problems that were experienced </li></ul><ul><li>Define possible actions to maintain the position in the market </li></ul>Objectives 02
  4. 4. <ul><li>British Luxury brand established in 1856 by Thomas Burberry </li></ul><ul><li>1920 ‘trench coat’ </li></ul><ul><li>Endorsed by royalty, politicians and celebrities </li></ul><ul><li>Now operates in Europe, North America, Asia </li></ul>Background 03
  5. 5. <ul><li>A desire to appeal to a wider audience </li></ul><ul><li>Change in design </li></ul><ul><li>Reduction in price </li></ul><ul><li>Product diversification </li></ul><ul><li>Excessive check usage on the products </li></ul><ul><li>Non-strategic distribution locations </li></ul>Mistakes 04
  6. 6. <ul><li>http://www.emeraldinsight.com/Insight/ </li></ul>05 The Burberry product/brand model
  7. 7. Existing Markets New Markets Existing Products New Products 06 Ansoff Matrix Diversification N/A Market Development Diffusion ranges in mid 1990s for wider audience (Younger Consumers) Product Development Burberry Accessories i.e. stadium hats, handbags, toys, fragrances etc. Market Penetration Classic garments for existing target market (Trench coats, outwear, etc)
  8. 8. <ul><li>Brand “Hijacking”: Association with hooligans and “chavs” </li></ul><ul><li>Counterfeits </li></ul><ul><li>£37m Decrease in sales </li></ul><ul><li>in 1997 </li></ul>07 Failure: Lost Brand Identity
  9. 9. <ul><li>1997- New CEO </li></ul><ul><li>Returning to Traditional Garments </li></ul><ul><li>Celebrity Endorsement </li></ul><ul><li>Reduced Exposure: Limited Advertising </li></ul><ul><li>More Selective Distribution </li></ul>08 Revitalisation
  10. 10. 09 Retail Lifecycle
  11. 11. <ul><li>4 P’s : </li></ul><ul><li>Product : Maintain Prestige, Push Product Beyond Plaid </li></ul><ul><li>Price : Keep premium pricing </li></ul><ul><li>Place : Selective location / Limited Distribution </li></ul><ul><li>Promotion : Continue to Place Advertisement in Exclusive Channels e.g. Fashion show </li></ul><ul><li>Maintain Good Media Relations </li></ul><ul><li>Clamp on Fraud </li></ul><ul><li>Continue to research target market </li></ul>10 Maintaining Success: Recommendations
  12. 12. Regional Revenue 11
  13. 13. <ul><li>More than two thirds of sales - abroad (unaffected by company’s problems in the UK) </li></ul><ul><li>Overall sales growth abroad – 11% </li></ul><ul><li>Biggest markets – Japan and Spain </li></ul><ul><li>Popular with young adults </li></ul><ul><li>Marketed by keeping it British </li></ul>12 Summary International Sales
  14. 14. <ul><li>UK: </li></ul><ul><li>Continue to identify product values and attributes. </li></ul><ul><li>Balance between accessibility and status </li></ul><ul><li>Target audience: those who best meet Burberry’s overall objectives. </li></ul><ul><li>Continue market penetration and invest in product development </li></ul>13 Overall Marketing Strategy
  15. 15. Existing Markets New Markets Existing Products New Products 14 Ansoff Matrix (UK) Diversification N/A Market Development Convert upper-class non-users Product Development New offerings i.e. in accessory market Market Penetration Winning customers and expanding value-added partnerships
  16. 16. <ul><li>Abroad: </li></ul><ul><li>Continue frequent flow of new products to Burberry’s stores. </li></ul><ul><li>Investment in high potential markets </li></ul><ul><li>Continue to represent British culture, history and tradition </li></ul>15 Overall Marketing Strategy
  17. 17. Existing Markets New Markets Existing Products New Products 16 Ansoff Matrix (Abroad) Diversification N/A Market Development Invest in high potential markets abroad i.e. Eastern Europe Product Development Developing niche accessories for e.g. in 2005 Burberry successfully extended their apparels to include golf wear in Korea Market Penetration Winning customers; upgrading distribution channels
  18. 18. <ul><li>Burberry - one of the most successful British fashion brands. </li></ul><ul><li>Has struggled to cleanse its brand image, after years of association with “chavs”, through various strategies. </li></ul><ul><li>This transition has allowed a gradual sales growth in the UK. </li></ul><ul><li>Has managed to revive as a prestigious and exclusive brand, departing from its “downmarket” brand image </li></ul>17 Conclusion
  19. 19. <ul><li>Any Questions? </li></ul>18 THANK YOU FOR YOUR TIME!
  20. 20. <ul><li>Adcock, D. (2001) Marketing Strategies for Competitive Advantage. Chichester: John Wiley & Sons </li></ul><ul><li>Anonymous (2007) Burberry; Mining the Past to Seize the Future, Business Week, Iss. 4045; pg. 58 </li></ul><ul><li>Barraclough, E. (2007) Fighting the Trade in Fakes [www] Available from: http:// www.managingip.com/Article.aspx?ArticleID =1377400 [Accessed 22 nd October 2007] </li></ul><ul><li>Bothwell, C. (2005) Article: Burberry versus The Chavs [www] Available from: http://news.bbc.co.uk/1/hi/business/4381140.stm [Accessed 8th October 2007] </li></ul><ul><li>Bryant, B. (2004) Burberry's Improved Marketing Strategy Results in Increased Sales at Home and Abroad [www] Available from: http://facweb.furman.edu/~dstanford/ibnotes/39cases04/bryant.htm [Accessed 23rd October 2007] </li></ul><ul><li>Burberry PLC (2007) Company overview and strategy [www] Available from: http://www.burberrygroupplc.com/brby/ [Accessed 7 th October 2007] </li></ul><ul><li>Burberry PLC (2007) Financials: Key Financials [www] Available from: http:// www.burberryplc.com/brby/fin/kfinancials / [Accessed 19 th November 2007] </li></ul><ul><li>Burberry PLC (2005) News & Features: Burberry launches golfwear in Korea [www] Available from: http:// www.burberry.com/AboutBurberry/NewsArticle [Accessed 23rd October 2007] </li></ul><ul><li>Burberry PLC (2007) News & Features: Burberry Opens First Store in Prague, Czeck Republic [www] Available from: http:// www.burberry.com/AboutBurberry/NewsArticle [Accessed 23rd October 2007] </li></ul><ul><li>Burberry PLC (2007) News & Features: Burberry sees sales growth [www] Available from: http:// www.burberry.com/AboutBurberry/NewsArticle [Accessed 23rd October 2007] </li></ul><ul><li>Burr, J. (2005) Brand Hijacking [www] Available from: http://www.limitedlanguage.org/discussion/index.php/archive/brand-hijacking/ [Accessed 8 th October 2007] </li></ul>References 19
  21. 21. <ul><li>Daily Mail (2006) Met's Operation Burberry causes fury at fashion house [www] Available from: http:// www.dailymail.co.uk /pages/live/articles/news/ [Accessed 9 th October 2007] </li></ul><ul><li>Fashion United (2006) Burberry not a ‘chav’ brand according to new boss [www] Available from: http:// www.fashionunited.co.uk/news/burberry.htm [Accessed 7th October 2007] </li></ul><ul><li>Gasbarre, D. and Stansell, C. (2007) Company History: Burberry Ltd [www] Available from: http://www.answers.com/topic/burberry-2?cat=biz-fin [Accessed 29 th December 2007] </li></ul><ul><li>Gusto Mondial (2007) Burberry [www] Available from: http:// www.gustomondial.ch/bodegas/burberrys.html [Accessed 8th December 2007] </li></ul><ul><li>McGoldrick, P. J. (2002) Retail Marketing , 2nd ed. London: McGraw-Hill </li></ul><ul><li>Mintel (2007) Burberry (Europe): Company Profile [www] Available from: http://academic.mintel.com/sinatra/oxygen_academic/search_results/ [Accessed 19 th November 2007] </li></ul><ul><li>Moore, C. M. and Birtwistle, G. (2004) The Burberry business model: creating an international luxury fashion brand, International Journal of Retail & Distribution Management, Vol. 32, Iss. 8; pp. 412-422 </li></ul><ul><li>O’Brien, D. (2003) When Imposters Knock Off Profits [www] Available form: http:// www.brandchannel.com/features_effect.asp [Accessed 22nd October 2007] </li></ul><ul><li>RNS (2007) Article: Burberry Group Plc – Trading Statement [www] Available from: http:// investing.reuters.co.uk/news/articleinvesting.asp [Accessed 23rd October 2007] </li></ul><ul><li>Times Online (2006) Article: New Boss Must Step Up the Luxury at Burberry [www] Available from: http://business.timesonline.co.uk/tol/business/industry_sectors/consumer_goods/ [Accessed 8 th October 2007] </li></ul><ul><li>Walker, R. (2005) The Good, the Plaid and the Ugly [www] Available from: http://www.nytimes.com/2005/01/02/magazine/ [Accessed 22 nd October 2007] </li></ul><ul><li>http://www.youtube.com/watch?v=-VfuRcDrK3I </li></ul>20 References cont

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