Burberry is a global luxury brand known for its British heritage and iconic trench coats. The company designs and markets apparel and accessories through retail, digital commerce, wholesale, and licensing channels worldwide. While Burberry has faced challenges maintaining a consistent brand image and countering counterfeiting, under new leadership in the 1990s it repositioned itself and saw success. It continues working to manage popularity and growth in a sustainable way.

2. Introduction
• Burberry is a global luxury brand with a distinctive British heritage,
core outerwear base and one of the most recognized icons in the
world. Burberry designs, sources and markets apparel and
accessories, selling through a diversified network of retail, digital
commerce, wholesale and licensing channels worldwide. The business
is managed by channel, region and product, supported by corporate
functions.

3. Case Study Synopsis
• Founded in 1856 by Thomas Burberry
• British used trench in WWI
• Trademark - (a camel, black, red, and white plaid design)
• Used in lining of signature trench coats
• Original designs and quality
• Celebrities, royalty, politicians, etc.
• Symbol luxury and durability

4. Case Study Synopsis
• In 1955, Great Universal Stores Plc. bought Burberry
• licensed the brand in Japan through Mitsui and Sanyo
• Global recognition through licensing and distribution agreements.
• 1997 new CEO Rose Marie Bravo
• Cosmetic - logo and brand name
• Update product line - consistency
• Reposition - keep consumers and attract younger customers.

5. Case Study Synopsis
• 2003- Primary Collections
• Womenswear, Menswear, Accessories
• 3,162 wholesale doors worldwide
• 434 department stores
• 2,728 specialty stores

6. Case Synopsis
• Biggest challenge
• Create a consistent brand image
• Risk losing brand and credibility
• Prorsum - luxury line
• Advertising Campaign : 2 phases
• Stella Tenant
• Kate Moss

7. Case Synopsis
• Challenges
• Counterfeits
• Popular among urban and hip-hop musicians.
• Sustainability
• Brand positioning
• Burberry = healthy
• Manage popularity = long-term growth

8. Within the Burberry offering, there is a product hierarchy
defining components - each with unique branding and a
distinctive identity.

9. Prorsum
• Most fashion forward
collection
• Centered around runway
shows each year
• Latin word for “moves
forward”
• Inspires the other lines
• Hand-tailored

10. Runway Video

11. Burberry London (International) Line
• Core collection
• High-end positioning
• Key to the turnaround of the
Burberry brand
• Strong womenswear and
accessories segments
• Main markets are currently in
Europe and US
• Products mainly sourced in Europe
and UK
• Thomas Burberry Spain & Portugal

12. Burberry London (Japan) Line
• Sold in Japan and made
locally
• High quality apparel but
lower positioning and
price points than the
International Line.
• Weaker accessories due to
licenses held buy small
manufacturers.
• Blue and Black Labels

13. Burberry Brit
• Customer wears on
weekend
• Casual wear
• Uses innovative and
more contemporary
versions of the check.

14. Game

15. Answers
London Brit Prorsum
Prorsum London Brit

16. Burberry Brand
• Defined by:
• Authentic British heritage
• Unique democratic positioning within the luxury arena.
• Founding principles of quality, function and modern classic style,
rooted in the integrity of its outerwear.
• Globally recognized icon portfolio: the trench coat, trademark check
and Prorsum horse logo.

17. Burberry Business
• Defined by:
1 Design, marketing and retail-led strategies
2 Digital focus and integration
3 Channel diversity: retail, digital commerce, wholesale and licensing
4 Multi-category competency: non-apparel, womenswear, menswear
and children’s wear.
5 Global reach and balance: across core regions and emerging markets

18. Culture
• The culture is distinguished by:
1 Core values: to protect, explore and inspire
2 Democratic and meritocratic ethos
3 Collaboration and connectedness
4 Contributing to its communities, including through the Burberry
Foundation.

19. Burberry sells its products to the end consumer through
both the retail (including digital commerce) and
wholesale channels. For 2009/10, retail accounted for
58% of revenue and wholesale 34%.

20. Channels : Retail
• 131 mainline stores
• 262 concessions within department stores
• 47 outlets
• Digital commerce in 27 countries

21. Channels : Wholesale
• Includes sales to prestige department stores
and specialty retailers worldwide.
• Sales to its franchisees who operate 97
Burberry stores, mainly in Emerging Markets.

22. Europe including Spain accounted for 44% of sales, Americas 27% and Asia Pacific
24%. Emerging Markets, which spans across all regions and includes China, India,
Russia, Eastern Europe and the Middle East, contributed 10% to retail and
wholesale revenue.
1 Americas: includes US, Canada, Central and South America
2 Asia Pacific: includes China

23. Outerwear, which is the core of the apparel offer at over half of sales, is the category in
which Burberry is top-of-mind among consumers.
Burberry continues to grow outerwear by continued product innovation.
Another key strategy is to grow non-apparel where revenue increased by 10% underlying
in 2009/10.
Burberry is planning further growth in all areas of the business over the next few years.

24. Channels: Licensing
• Selective licensing agreements in Japan and globally,
leveraging the local and technical expertise of its license
partners.
• Royalty income primarily received from Burberry’s
licensees in Japan.
• Its global licensees
• fragrance
• eyewear
• timepieces
• small menswear
• European children’s wear

25. Social & Environmental Achievements
2010-2011
Increased the number of factories with worker hotlines by 54% to a total of 33.
1 Joined the Ethical Trading Initiative – the first luxury brand to do so.
2 Launched a Sustainability Digital Film to employees globally to raise awareness of corporate
sustainability initiatives.
3 Committed to increase the proportion of the Group’s UK electricity purchased from combined
heat and power sources from 29% to 100% to drive demand for renewables in the UK.
4 The Burberry Foundation distributed over 2,500 iconic trench coats to partner charities in
London, New York City, Hong Kong and Seoul, all working with disadvantaged youth.

26. Kate Moss Scandal
• Burberry distanced itself from Moss in
September 2005, days after The Daily
Mirror published pictures of her
allegedly snorting cocaine.
• The company dropped plans for Moss
to appear in its fall 2005 campaign,
and posters featuring the model were
removed from its flagship store.
• Burberry stressed in November that it
had not severed ties with the model.
• A year later she got back with
Burberry.

27. Positioning

28. Geographical Mix
• Under Retail
• Low transactional exposure
• Outsourcing of productional activities
• Allows production in various countries
and currencies.
• Yen - Japan license

29. Vertical Integration
• Under Retail
• Recent acquisitions of licensees in Spain
• Distributors in Korea and the Asia Pacific
• Combined with ambitious retail extension
• Not very integrated
• Deliberately has limited production
capabilities.

30. Business Mix
• In the middle of luxury and retail.
• Consists almost entirely of apparel and
accessories.
• Burberry’s business mix seems comparable to
that of H&M, Hugo Boss and Inditex but also
to that of Gucci and Hermès.

31. Pricing Power
• Burberry sells premium products in a high-quality distribution network.
• This positioning is synonymous with higher prices and higher
distribution costs.
• The company has much lower transactional exchange exposure than luxury
goods companies
• Therefore does not need to make up as much revenue in times of
adverse exchange-rate movements.
• Burberry has in the past increased fees due by its Japanese licensees, Sanyo
Shokai and Mitsui & Co.

32. Design & Quality
• High on Luxury goods category
• Christopher Bailey worked at Donna Karan and
Gucci.
• Core heritage products
• A high fashion range - Prorsum
• high end product line - London

33. Management
• Under Retail
• CEO- Rose Marie Bravo
• Retail and Wholesale background
• President of Sak’s Fifth Avenue in US
• Chairman and CEO of Macy’s speciality
division.
• Angela Ahrendts - CEO July 2006
• Executive Vice President - Liz Claireborne
• President of Donna Karan International

34. CEO Video:Angela Ahrendts

35. Strengths
• Strong proven management team
• Licensing growth delivers high return on capital
• Heritage products
• Flexibility in product sourcing
• Lower transactional exchange exposure

36. Weaknesses
• Low vertical integration reduces capture of
margin and value from manufacturing.
• Low gearing into Japanese upside.
• Apparel segment - increased risk still accounts
for most of company profits.

37. Opportunities
• Retail network expansion
• Widening of wholesale distribution
• Extension of apparel offering
• Further development accessories (Spain & Japan)
• Increased distribution of Burberry London (Japan)

38. Threats
• Conflicting interests of GUS and external Burberry
shareholders.
• Reliance on 3rd parties in Japan
• Counterfeiting
• Control over licensees and wholesale accounts
• Company is mono-brand and trademark is core.

39. Conclusion
• Explore opportunities
• Demographic Studies
• Know their threats
• Relied on Licensing ---> Repositioning
• New image -----> Success
• Compete with some of the best luxury brands.
• Sustainability

40. Any Questions?