Burberry Case Study: Retail-led Strategy to Target High Net Worth Individuals in Asia Pacific

Published by: MarketLine

Published: Jan. 13, 2012 - 17 Pages


Table of Contents

Overview
Catalyst
Summary
Analysis
Chapter 1 Capturing the new generation of luxury consumers with digital integration
“Mining the past to seize the future”
Burberry will target 25 of the world's wealthier cities
From a static wholesale concept to a dynamic retail model
Six languages across 45 countries and digital integration through Burberry World
Capturing a new generation of luxury consumer by combining PR with social media
Fashion shows streamed directly to flagship stores globally
Chapter 2 Investment in underpenetrated markets
80 directly operated stores opened in 2010/11, of which 57 were in China
50% of total revenues from Asia Pacific by the end of 2015
Brand control in the fastest-growing luxury market in the world
73% of China’s luxury buyers are under 45 years old
In order to imprint its brand in the minds of emerging luxury consumers, Burberry is focusing on young, tech-savvy shoppers
Social media to build recognition and strong relationships with the brand in China
Extended presence in Latin America, India and new markets
Chapter 3 Measuring strategy outcome
105 new stores around the world and a 11% productivity increase
Total revenue increase of 35% per year
Non-apparel revenue increase of 32%
Average retail selling space increased by about 14% in FY 2012
£180-200 million to be spent on further development of the growth strategy
Conclusions
Burberry's investment in Asia Pacific has benefited the company
Appendix
Sources
Further Reading
Ask the analyst
About MarketLine
Disclaimer
TABLE OF FIGURES
Figure 1: Burberry’s retail sales by segment, 2010-11 (%)
Figure 2: Retail and wholesale revenue by destination
Figure 3: Burberry – number of stores open in 2010/11
Figure 4: Revenue growth by channel (£ million)
Figure 5: Revenue growth by category (%)

Abstract

Introduction

Burberry’s retail-led growth strategy is focused on digital integration. The company is investing in underpenetrated markets such as Asia Pacific and Latin America as continued growth in luxury goods sales is forecast. The company’s targets are 25 of the world's wealthier cities, as these benefit from high levels of tourism and high net worth residents.

Features and benefits
  • MarketLine Case Studies describe topics such as innovative products, business models, and significant company acquisitions.
  • Fact-based and presented in an accessible style, they explain the rationale of commercial designs and illustrate wider market and economic trends.
Highlights

Burberry recorded a 35% revenue increase in 2010/11 compared to the previous year. China contributed 5% to underlying growth. Non-apparel, including handbags, small leather goods, scarves, shoes, belts and jewelry, remain key drivers of the company’s growth, contributing 40% of retail/wholesale sales during 2010/11.

The company increased the number of directly operated stores by 105 in 2010/11. Overall Burberry store productivity increased by 11% in 2010/11. Average unit retail prices rose during the period, while product flow and replenishment capability improved. About half of the new stores were opened in existing high profile markets.

The company now has 57 shops in China, and this figure is expected to almost double within the next five years. In Latin America, the group now has three stores operating. Through franchise partners, the first Burberry stores were opened in Armenia, Egypt, Israel, and Mongolia during 2010/11.

Your key questions answered
  • How is Burberry delivering such a strong performance during a period when many retail businesses are struggling?
  • What are the opportunities of investing in underdeveloped markets? How does a company imprint a brand image in customers' minds?


Get full details about this report >>
 
Learn more about this product


Price and delivery options
Search Inside Report

US: 800.298.5699

Int'l: +1.240.747.3093

 

About MarketResearch.com
MarketResearch.com is an online aggregator selling over 400,000 market research reports, company profiles and country profiles from over 720 research firms. Our reports will provide you with the critical business and competitive intelligence you need for strategic planning and marketing research. Coverage includes the US, UK, Europe, Asia and global markets.