Burberry Case Study
1. The Burberry brand has be come a symbol of both luxury and durability. The brand has been repositioned to a niche market between cutting-edge fashion apparel, like Armani, and classic fashion apparel, like Polo Ralph Lauren. Burberry has also excelled in the accessories market, positioning itself between the Coach and Gucci brands. Burberry does not want to be cutting-edge fashion and at the same time, does not want to be viewed as just classic, as this market is already saturated with other brands.
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Burberry represents “accessible luxury”, meaning they were fashionable, but also functional. Burberry’s competitive position is sustainable over the long-term providing that the industry itself remains stable. Burberry’s competitors, like Ralph Lauren, have proven that they can maintain their position over the long-term in both low-end traditional and high-end fashion markets so I believe Burberry has the capability to do the same. Burberry maintains its position of fashionable and functional.
If they can do this, the barrier to entry for this niche should remain too high for competitors to enter. 2. Since her arrival at Burberry, Rose Marie Bravo set out to make Burberry “great from a global perspective”. She attempted to do this by implementing multiple key changes to the Burberry brand. These changes include repositioning the brand, updating the product line, establishing flagship stores, expanding the brand portfolio, and promoting the new brand image. Bravo was able to reposition the Burberry brand into the category of luxury brand.
She did so by filling an empty gap in the market, between that of classic fashion and cutting-edge fashion. The goal of this change was to attract younger customers while retaining their core customer base. While repositioning a brand is always risky, finding a niche market and not directly competing with these other luxury brands helped Burberry to minimize some of the risk from the change. Burberry also limited risk by catering to both fashion and function. The next change that Bravo made was to update the product line.
Bravo and her team drastically cut the number of products from 100,000 to 24,000, eliminating outdated designs and creating a consistent look across all of their products. They began to classify their products into two separate categories: continuity or fashion-oriented. The continuity products, such as the classic trench coat, were expected to have a life cycle that lasted over a number of years. The fashion-oriented products were designed to react to the newest fashion trends and typically only had a seasonal life cycle. These changes significantly reduced the risk of the Burberry transformation.
Burberry had three primary collections: womenswear, menswear, and accessories. The womenswear line expanded from its traditional focus on winter and autumn season to include apparel for the spring and summers seasons as well, appealing to a broader range of customers. The meanswear collection was very “cross-generational”, spanning from young urban professionals to older, classic men. The accessories collection was not as fashion oriented and also did not have to accommodate different size variations, so therefore it generated less risk than the apparel collections.
The establishment of flagship stores has also helped to minimize risk by acting as a testing ground for new concepts and designs before they are distributed to a wider market. Also, Burberry has maintained a strong vision and consistent voice, which has helped establish it’s brand image and maintain its brand credibility. By expanding the brand portfolio from just the company’s core label, Burberry London, into the high end with it’s Prorsum label, Burberry was able to reinforce it’s new positioning in the luxury market.
Expanding into this market does come with added risk, given the volatility of the high-end fashion market. The Prorsum label is able to mitigate some of this risk by providing Burberry with a “laboratory for ideas” that they are able to implement into other areas of their business. Burberry was also able to mitigate the risk of the transition by successfully promoting it’s new brand image. Burberry was able to portray itself as a heritage brand while at the same time associating itself with a trendier, more modern look.