Burberry plans to put an even greater focus on cultivating customers in their home markets.
With international tourism frozen for now and demand springing back in parts of Asia, Burberry plans to put an even greater focus on cultivating customers in their home markets, creating specially-tailored ad campaigns, pop-ups, capsule collections and digital outreach programs to get people shopping again.
COVID dashed those hopes, dragging down Burberry’s comparable store sales by 27 percent in the fourth quarter when around 60 percent of the brand’s retail stores were forced to shut. That decline in retail sales compares to a 4 percent rise in the first nine months of the year.
Gobbetti called the new store “a fundamental testing ground” for new modes of shopping, and noted the store will be the first Burberry unit to blend physical with digital retail. The brand was supposed to take its fall 2020 runway show to Shanghai in April, but canceled the event earlier this year and has yet to reschedule it.
So far, the company’s efforts have been paying off, with growth in both China and South Korea now in the double-digits and surpassing last year’s levels. He said the company was seeing “significant traction” in the sale of handbags and small leather goods. Burberry said it saw double-digit growth in followers and engagement on social platforms year-on-year, including through the crisis, while digital sales have seen a double-digit increase year-on-year with “strong demand” on brand and third-party digital platforms alike. Building on that momentum, Burberry said it plans to debut a leather goods pop-up shop online this summer.
There is no doubt that Burberry’s year ended on a disappointing note, but the brand, like its other luxury peers, has been quick to pivot, making hospital gowns at its Yorkshire factories and sourcing surgical masks for the National Health Service. Meanwhile, the company said its existing cost-saving program delivered cumulative savings of 125 million pounds this year and the program has been accelerated to deliver cumulative savings of 140 million pounds by fiscal 2020-21. The company added that its balance sheet is strong, with cash of 887 million pounds, with actions in place to protect liquidity.
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