Burberry Branding CaseEssay Preview: Burberry Branding CaseReport this essayDescribe the evolution of Burberrys positioning and customer base.As a brand with long history tracing back to the 1850s, Burberry has long been known for its luxury and durability. During the mid 1950s, Burberry was one of the most promising fashion brands in the world. However, with mistakes in their business strategy, Burberrys situation worsened. The primary problem was that they didnt impose strict control over their licensees who had relatively high freedom in their operation. Thus, it was difficult to maintain the quality and design of products across markets and resulted in deteriorated brand image. Before Bravos era, Burberry was perceived as a “conservative” brand that was being used by older people.
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Bravo came in and repositioned the brand. In order to expand the customer base to include younger customers, while at the same time, retaining the core customer base, they repositioned themselves as “accessible luxury”. Burberry positioned themselves between being functional, which has long been its main value, and being aspirational, adding the fashion mechanism into the brand. Thus, theyve managed to extend their customer base by retaining existing customers who seek luxury and functionality, and adding younger generations who seek aspiration.
The case notes that Bravos team has managed to elevate the overall status of the Burberry brand. How has it managed to accomplish this?Apart from repositioning the brand, improving the operations is also very important to the companys success. As mentioned in the first question, Burberry had problem with licensees who were given freedom. Burberry became much stricter in controlling the quality in sourcing and manufacturing. Whenever the products needs to utilize skills from outside the company, licensees were carefully selected to design, manufacture, and distribute product. The carefully selected licensee ensures product quality that is up to the companys standards which would maintain the brands great reputation. Bravo had also imposed stricter controls on the licensing agreements with older licensees in order to guarantee consistent products across markets. The same applies for old distributors. To guarantee tighter control, Burberry terminated some contracts, buying some distributors, and renegotiated contracts with others. These efforts, apart from preventing low quality products that would tarnish the brands image, also allowed the company to structure its distribution channels. As a luxurious goods, the brand must not over-sale and create ubiquity. Customers are willing to pay more for luxurious products because it represents uniqueness and self fulfillment. Thus, if everyone is able to use the product, than it has failed to establish itself as luxurious goods.
To be consistent with their positioning, the pricing strategy also had to be adjusted. Gross margin were increased to 56% compared to 47%. Promotional strategy was also very important in establishing the success. Burberry selected models such as Stella Tenant and Kate Moss which represented their target markets. Stella represented more towards the luxurious aristocrat which was the core customer base of the brand, whereas Kate Moss represented more towards the modern fashion oriented customers
What did Bravo and her team do in order to revitalize Burberrys product line?Prior to Bravos era, distributors and licensees were messed with the designed and quality of products. The company relied on only a few core products of the company. Thus, Bravos first action was to eliminate outdated designs and products that were inconsistent with the brands image. After that, they started to create new products which could be classified as either continuity or fashion-oriented. Products in the continuity category have several years of life cycle while fashion-oriented products had shorter cycle and are introduced to the market on a collection basis. The primary collections under the Burberry brand are womenswear, menswear, and accessories.
Bravo also expanded