ESTRATEG ICFASHIONMARKETING PLAN

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STUDENTS NAMES : ANDRES MOL INA & VALENT INA DUQUECOURSE NAME : HERRAM IENTAS TECNOLÓG ICAS I ISTRATEG IC FASH ION MARKET ING P .COURSE CODE : 2 1

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B RAND

P . 0 3 - 04 EXECUT I VE SUMMARY

P. 0 5 - 0 6BRAND H I S T O R Y

P. 0 7 P R O D U C T

STUDENTS NAMES : ANDRES MOL I NA & VALENT I NA DUQUECOURSE NAME : HERRAM I ENTAS TECNOLÓG I CAS I IS TRATEG I C FASH I ON MARKET I NG PLANCOURSE CODE : 2 1 FO

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02WHO WE ARE?

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P. 0 9MARKET OVERVIEW

P. 1 2B I B L I O G R A P H Y

ExecutiveSummary

• Thi s i l lu strated s trateg ic fa shion market ing p lan i s evaluat ion of Burber r y’s cur rent pos i t ion and

s trateg y in luxur y fa shion market .

The object ive of this repor t is to analyze and eva luate the brand’s market ing approach, ac t iv it i-es , aims, and results achieved through the appropiate se lec t ion and appl icat ion of maket ing tools and methodologies . Based on market t rends , consumer behavior and product demand research this work wi l l introduce a new market ing strateg y and its implementat ion for luxur y brand Burberr y .

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BURBERRYHISTORYBRAND 0 1

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T H E B R A N DBurberry was founded in 1856 when 21-year-old Thomas Burberry, a former draper’s apprentice, opened his own store in Basingstoke, Hampshire, England By 1870, the business had established itself by focusing on the development of outdoors attire. In 1880, Burberry introduced in his brand the gabardine, a hardwearing, water-resis-tant yet breathable fabric, in which the yarn is waterproofed before weaving “Burberry” was the original name, but then the company soon switched to using the name “Burberrys”, after many custo-mers from around the world began calling it “Burberrys of Lon-don”. This name is still visible on many older Burberry products. In 1891, Burberry opened a shop in the Haymarket, London. 20th century. In 1901, the Burberry Equestrian Knight Logo was developed con-taining the Latin word “Prorsum”, meaning forwards, and registe-red as a trademark. In 1911 they became the outfitters for Roald Amundsen, the first man to reach the South Pole, andErnest Shack-leton, who led a 1914 expedition to cross Antarctica. A Burberry gabardine jacket was worn by George Mallory on his presumed ill-fated attempt on Mount Everest in 1924. In 1914, Burberry was commissioned by the War Office to adapt its officer’s coat to suit the conditions of contemporary warfare, re-sulting in the “trench coat”.] After the war, the trench coat became Influences and rise to prominence

Stars of the modern world began wearing the Burberrys brand. Notable people include, Humphrey Bogart, Audrey Hepburn, Pe-ter Sellers, and Ronald Reagan. During the 1970s and 1980s, Bur-berrys signed agreements with worldwide manufacturers to produ-ce complementary products to the existing British collection such as suits, trousers, shirts, sportswear, accessories, for men, ladies and children. These products, designed under the strict control of headquarters in London, were produced and distributed through independent retail stores worldwide as well as the Burberry stores, and contributed to the growth of the brand through to the 90s. The company signed Lord Litchfield as photographer, and appointed Lord (Leonard) Wolfson and Stanley Peacock OBE, chairman. In 1998, Bur-berrys changed their marketing name to Burberry.

21st century I The association with football hooliganism led to the we-aring of Burberry check garments being banned at some venues GUS divested its remaining interest in Burberry in December 2005. Burberry Group plc was initially floated on the London Stock Exchange in July 2002. In 2005, Sanyo-shokai was the Burberry ready-to-wear licence holder in Japan with retail value of €435 million.In 2006, Rose Marie Bravo, who as Chief Executive had led Burberry to mass market success through licensing, decided to retire. She was repla-ced by another American Angela Ahrendts, who joined from Liz Clai-borne in January 2006, and took up the position of CEO on 1 July 2006.

Ahrendts and Bailey successfully turned around the then Chav-like reputation that the brand had acquired at the end of Bravo’s tenure, by removing the brand’s check-pattern from all but 10% of the company’s products and buying out the Spanish franchise that was worth 20% of group revenues.

In October 2013, it was announced that Ahrendts would take up the position of Senior Vice President of retail and online at Apple, Inc. from April 2014, and be replaced as CEO by Bailey. During her tenure, sales increased to over £2 billion, and shares gained more than threefold to £7 billion. Although Burberry promotes its British connection, according to The Guardian, a British national daily newspaper, as of July 2012, Burberry maintains only two production facilities in Great Britain, one in Castleford producing raincoats, and a smaller one in Keighley. In spring 2014, Christopher Bailey became CEO of Burberry and retained the role as chief creative officer. His basic salary is £1.1m, with total compensation of up to £10m a year depending on sales targets being met .

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PRODUCTBurberry sells its products to the end consumer through both retail (including digital) and wholesale

channels. For 2013/14, retail accounted for 70% of revenue and wholesale 27%. Burberry also has licensing agreements in Japan and globally, leveraging the local and technical expertise of its licence

partners.

Retail Includes 215 mainline stores, 227 con-cessions within department stores, digital commerce and 55 outlets · 15% underlying growth · 12% comparable sales growth · 25 mainline store openings, including a flagship in Shanghai and the first Burberry Beauty Box in Covent Garden, London

Wholesale Includes sales to department stores, multibrand specialty accounts, Travel Retail and franchisees who operate 70 stores, and Beauty to nearly 100 distributors globally · 32% underlying growth (2% growth excluding first time contribution from Beauty) · Beauty wholesale revenue of £144m in first year of direct operation · Net five new franchise stores opened, including stores with new partners in Barbados, Chile and Colombia

Licensing Includes income from Burberry’s licensees, about 80% from Japan with the balance from global product licences (eyewe-ar and watches) and the European wholesale childrens licence · 23% underlying decline (2% growth ex-cluding the fragrance licence income in 2012/13) · Royalty income from Japan broadly unc-hanged at constant exchange rates · Global product licences delivered double-digit per-centage growth (watches and eyewear)

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A DISTINCTIVE GLOBAL LUXURY BRAND:

Founded in 1856, Burberry is a global luxury brand with a distinctive British identity. Over the decades, the brand has built a reputati-on for craftsmanship, innovation and design. Since the invention of gabardine by Thomas Burberry more than 150 years ago, outerwear

has been at the core of the business, and remains so today – best expressed through the iconic Burberry trench coat.

Business · Products created in keeping with brand attributes to  appeal to luxury consumers: – primary categories include women’s and men’s apparel and acces-sories and Beauty. · Brand engagement driven by innovative use of digital, social and traditional media to connect audiences globally with the brand:

– with emphasis on the millennial consumer.

· Owned distribution network consisting of:

– offline: 497 directly operated stores and concessions operating in 32 countries; – online: burberry.com digital platform active in 11 languages; and – ongoing initiatives to integrate online and offline to crea-te a seamless and consistent brand experience, however and where-ver the consumer chooses to engage with the Burberry brand.

· Third-party distribution network includes 70 franchise stores in an additional 28 countries and approximately 1,400 wholesale de-partment and specialty store doors in over 80 countries.

· Consumer touch-points aligned with the goal of communicating pure brand message.

· Functional infrastructure to support execution from conception t to consumer.

Culture The Company designs, produces and sells products under  the Burberry brand. Product conception, design and development are housed in Burberry’s London headquarters. Fabrics and other ma-terials are sourced from, and finished products manufactured at, both Company-owned facilities in the UK and through an exter-nal supplier network, predominantly located in Europe. Marketing content and programmes, traditional and digital, are  developed internally to communicate brand and product attributes to con-sumers. Burberry products are sold globally through proprietary retail platforms and third-party wholesale customers .

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MARKET Burberry has a diversified product offering across apparel, accessories and Beauty and by gender. For 2013/14, accesso-

ries represented 36% of retail/wholesale revenue, womens 30%, mens 23%, childrens 4% and Beauty 7%.

Americas · 24% underlying growth · Retail accounted for about 60% of revenue · High single-digit comparable sales growth · Digital penetration in the United States more than twice the Group average

EMEIA · 17% underlying growth · Retail accounted for about 65% of revenue · High single-digit comparable sales growth · About 40% of mainline transactions to trave-lling luxury customers

Asia Pacific · 18% underlying growth · Retail accounted for about 85% of revenue · Double-digit comparable sales growth led by Greater China, especially Hong Kong · Travel Retail, which makes up the majority of wholesale in the region, performed well

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MARKET OVERVIEW

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Macroeconomic environment In 2013 the global economy continued its recovery growing at 3%, in line with 2012. While the beginning of the year saw continued uncertainty in the Eurozone and concerns around China’s eco-nomic growth prospects, in aggregate macroeconomic indicators accelerated throughout the year. In Europe recovery continued to be slow, with European Union GDP growth flat. Despite on-going government austerity measures, there were positive signs in the region, as periphery countries’ key macroeconomic indicators showed improvement. In the USA, quarterly GDP growth accele-rated throughout the year to an annual growth rate of 1.9%. More importantly for the luxury retail sector, this was accompanied by a continued increase in personal consumption.

Improving sentiment in developed economies was partially offset by a slowdown in emerging markets. China GDP grew by 7.7%, in line with 2012, and accounted for half of global growth. Per-formance in other key developing luxury markets was mixed with Russia and the Middle East  slowing during the year, while the Brazilian economy accelerated slightly to 2.3%.

Luxury sector* Against this global backdrop, analysts estimate that luxury sector growth slowed to 2% in 2013, following three years of reported double-digit growth. However, excluding currency effects, the sec-tor grew at closer to 6% in line with 2012.

In mainland China, now the world’s fourth largest luxury market, sales growth slowed to 4% at constant foreign exchange rates, dri-ven by new government policies on gift giving and Chinese cus-tomers increasingly shifting their  luxury shopping abroad. This travelling luxury consumer outflow helped drive luxury sales in the rest of Asia and Europe.

In many South-East Asian markets, the impact of this travelling consumer growth was further enhanced by increasing domestic consumption, particularly in the fastgrowing economies of Ma-laysia, Thailand and Indonesia

Europe also benefited from the growth of luxury tourism, particularly from emerging markets, while local consump-tion remained volatile for the sector. The travelling luxury consumer is estimated to account for over half the luxury sales in major markets in the region. In the Americas, luxury sector growth accelerated in real terms as consumer confidence in the wider economy improved, surpassing Asia as the fastest-growing region. Although it remains a predominantly local market, luxury tourism, particularly from China, is becoming increasingly relevant in the Americas region.

Globally, digital commerce continued to gain importance, with the USA leading the way. This channel has grown ten-fold since 2003 and now accounts for around 5% of the glo-bal luxury goods market. It is believed that the increasing use of digital platforms for browsing and shopping partially explains the decreasing store traffic across the luxury sec-tor.

When looking at demand across key product categories in the luxury sector, accessories continued to outperform, with men’s accessories growing at a double-digit percentage rate. Within ready-to-wear, mens continued to grow ahe-ad of womens. Beauty sector growth slowed to 2% during 2013 from 4% in 2012, with deceleration in both the cos-metic and fragrance markets, especially in Europe.

Outlook Industry analysts expect the luxury sector to grow mid-single digits in the medium term at constant foreign exchange rates, as the anticipated wider global economic recovery continues. These growth forecasts are supported by long-term demographic trends, particularly the expan-sion of the consuming classes in emerging markets, increa-sing urbanisation and the growth of global travel.

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CYBERGRAPHYBurberry strategic fashion marketing plan - https://issuu.com/ausracincyte/docs/strategic_fashion_marke-ting_plan_pa

Burberry Annual Report - http://www.burberryplc.com/documents/ar-13-14/burberry-annual-re-port-2013-14.pdf

PICTURES: WWW.BURBERRY.COM.UKhttp://www.mistermoda.com/wp-content/uploads/2014/03/800x1422xThe-Burberry-Heritage-Trench-Coat-The-Kensington-men-trench-coat-burberry-photos-001.jpg.pagespeed.ic_.xk9YGrI9xc.jpg

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