Arguably the finest looking retail street in London, Regent Street’s sweeping thoroughfare is home to the world’s largest Burberry store. The former theatre and cinema is a huge, cavernous stage for the only domestic luxury mega-brand the UK has. What you’ll notice recently, as you walk past, there is never anybody in it. Worryingly, the store always looks empty of customers, and, as is often the case in fashion, you don’t need to see financials or figures to see whether something is instinctively selling or not.
After two distinctly underwhelming, but vast collections under new Creative Director Riccardo Tisci, the first results are in and it doesn’t bode well. Sales are flat in a market that has seen stellar performances from Kering and LVMH. Burberry’s sales grew by just 2% to £2.7B over the year to March 2019 with an adjusted operating profit of £438m. According to Bain & Company, the luxury goods and experiences market grew by 5% in 2018 and to put this into further context, LVMH was up 10% and Kering was up an incredible 26.3% over the same period.
Left - Gigi Hadid in Burberry's latest campaign. The collection could easily be confused with Fendi
After Burberry’s huge growth under previous Creative Director, Christopher Bailey, the brand’s new strategy is to take the brand more upmarket and completely change the feeling and identity of the brand. Marco Gobbetti, Chief Executive Officer, who hired Tisci, puts a positive spin on it in the brand’s latest financial release, “We made excellent progress in the first year of our plan to transform Burberry, while at the same time delivering financial performance in line with expectations. Riccardo Tisci’s first collections arrived in stores at the end of February and the initial reaction from customers is very encouraging. The implementation of our plan is on track, we are energised by the early results and we confirm our outlook for FY 2020.”
The two stores Burberry had in Knightsbridge have closed and are now a trashy souvenir shop and while they said they are taking a new store above the Tube station, it is a long way off from opening with only the facade currently standing.
The only hope is that they are still selling in China. There was a report in Jing Daily, the leading digital publication on luxury consumer trends in China, in April, that said Burberry had shut down four retail stores in Shanghai since August 2018, with the latest closure occurring on March 31, when the brand ceased the operation of its flagship store at the city’s L’Avenue, which it opened in 2013. The article said “the company had been laying off Chinese staff in preparation for the closure until only seven of them remained”. The publication also said the permanent closure of the L’Avenue store represented a “landmark event” in Burberry’s perceived exit from Shanghai.
According to the results, in Asia, it’s seen low single digit growth in Asia Pacific, Korea and China, stable in Hong Kong and declining in Japan. Which is worrying. Burberry is also cutting costs to shore up the balance sheet.
The company is pinning all its hopes on the new Tisci product. The statement said “The first deliveries of Riccardo Tisci’s products arrived in stores at the end of February. Although it is currently a small portion of our offer, the initial reaction from customers has been very positive with sales of the new collections delivering strong double-digit percentage growth.” It’s not clear what the growth is in comparison to.
The company says it is currently on a multi-year journey to transform and reposition Burberry. “FY 2019 and FY 2020 are foundational years where we will re-energise the brand, rationalise and invest in our distribution and manage through the creative transition, after which we will accelerate and grow.”
In retail, they say they are focused on refreshing flagship stores, with over 80 retail doors expected to be “aligned” by the end of FY 2020. "To ensure we are focusing our resources on the most impactful locations, we will also be closing 38 smaller, non-strategic retail stores in secondary locations. In wholesale, we stepped up our wholesale rationalisation in the second half of the year, phasing out non-luxury doors.” says the financial statement. In total, Burberry closed a net 18 stores (seven mainline, nine concessions and two outlets) in the year and new openings included the relocation and expansion of the Dubai flagship and openings in Shin Kong Place, Xian (China). Fourteen retail stores had been aligned to the new aesthetic by the end of the period.
Tisci’s first collection ‘Kingdom’ hit stores in February, but it didn’t create the much needed desire within the fashion community which ripples out to consumers. In that period, we’ve seen Givenchy fly, Gucci continue to power on and Bottega Veneta get a new designer and start to make waves. Unless you make positive gains from the energy around a new star creative designer, the energy quickly falls flat and the new Burberry seems to have been striped of identity during its rebrand.
Riccardo Tisci’s and Christoper Bailey’s Burberrys were always going to be very different. One was incredibly successful and turned the company into a global, billion dollar player, the other, was a fresh start, hoping to equal the growth and appeal of its predecessor but with a new, more street-like aesthetic while trying to elevate the brand.
Burberry feels like a brand going into reverse and unless new collections start to create some form of excitement people won’t be willing to pay more. The momentum it has built up over the past decade will disappear and it will be a tough job to get that back. This feels like a brand to ‘sell’ before the evidence of the failure of this new strategy becomes even clearer.
Burberry has opted to put all its checked eggs into Riccardo Tisci’s basket. Before a single collection, except for a couple of teaser T-shirts, they’ve changed the logo - 2018 is the year of the bland, officially - found an old monogram in the archive - plastered London (& the world) with it - and really committed to this creative director before a single industry or customer reaction.
Unlike Gucci, who rushed out a quick collection with Michele, and tested the water, this has had a six month build up. Need I remind you what happened at Roberto Cavalli or Brioni when they changed everything for a new creative director.
Left - Burberry's new monogram from the archive
Following the departure of Christopher Bailey - more here - whose rainbow swan song ended an era when Burberry was a fashion leader. The winds of fashion changed, Burberry was no longer as relevant and it’s been playing catch up recently.
Control, alt, trenchcoat?! The new Chief Executive, Marco Gobbetti, previously at an accented Céline, inserted Tisci, whom he worked with at Givenchy. and proclaims to want to ‘elevate’ the brand and take it away from ‘accessible’ luxury. I’m not sure how accessible the current £1500 trench coats are, btw?
The stock market likes the idea - the share price is up 20% so far this year - and is salivating at the higher prices and bigger profits these more expensive items should generate. If only fashion was that simple.
Cut to Vauxhall, and the first show from Tisci’s new ‘B Series’ Burberry. You can shop his first pieces now – available for 24 hours, only on Instagram.
Right - New Burberry projected onto Global Harbor, Shanghai
First impressions is, it’s big - 133 looks (crazy) - but doesn’t have a clear viewpoint. I would have done a smaller collection - say 40 looks - and kept its message very focussed, strong and styled.
It looked like a Parisian’s take on Burberry, and maybe something Phoebe Philo would have done, if she’d got/wanted the job. It’s probably too tasteful for the current Burberry customer; they want more check and logos. People go to Zara for these types of clothes, these days. When people buy ‘designer’ they want a statement, they want a recognisable piece and there didn’t seem to be much of that here.
If Burberry wants to do clothes like this, at these prices, then the quality and cut needs to be flawless. There was a couple of nice takes on the trench. I liked the silk scarf details on one.
Brands need to highlight something they’re getting behind for that season, be it a bag or a type of coat, and really ram it home. I couldn’t see any key bag styles, and, if they’re going to elevate the brand, like they hope, then it will all be from accessorises to drive the revenue growth.
The male models, with their 80s gelled back hair, had touches of Tisci’s Givenchy in the baggy sweat shorts and luxury sportswear, but there was nothing here you couldn’t get at Boss or Louis Vuitton.
Left - Armed with an umbrella, but where was the Britishness? Burberry SS19 Menswear
I was expecting the new monogram to be on everything, it wasn’t. I feel like that’s a mistake, no matter how tacky it could be. It would be a major sales driver in the all important Asian market and I’m sure we’ll see more in these ‘drops’ of collections we keep hearing about. There could have easily have been a logo segment in this huge collection.
It was chic, at the beginning, with some nice detailing, then the men’s section arrived, and then it got all confused towards the end. Sadly, these aren’t the type of clothes you’ll be thinking about until they come out, there’s just too much good competition.
News just in - Burberry president and chief creative officer, Christopher Bailey, who has been with the Burberry brand for 17 years, will stand down from its board in March 2018 and work with CEO Marco Gobbetti and team on a transition period until December 2018.
When Burberry’s renaissance began in the late 1990s, it was the perfect time to turn around a recognisable British name, dust it off and grow it into the new desire for luxury and branded products. We’d witnessed it at Gucci, under Tom Ford, and other languishing brands were thirsty for the same.
Burberry initially started with the Italian designer, Robert Menchetti. That didn’t last long and was soon replaced by an unknown designer, Christopher Bailey.
Left - Christopher Bailey who turned Burberry into the billion dollar business it is today
Initially, and this was pre-Google, so you can forgive me, I thought it was the same Chris Bailey who had started Jigsaw Menswear and the soon-to-be defunct Uth. A great designer and businessman, I thought it was a perfect fit.
I quickly realised they were different people and I bought a shirt from that first 2001/02 collection. Admittedly, it was in the Harrods sale and it was very expensive, if I remember, and I still have it. It was in a stretch, striped fabric, one I hadn’t seen before, with metal Burberry branded buttons and epaulettes. There was something beautiful yet innovative which became the signature of the new Burberry.
I quickly became fan. Every collection had a strong theme and the pieces were well designed and had that all important desire factor. The brand got bigger, the shows became fancier and major events with Christopher Bailey overseeing every detail, from store fits to the music to the Testino campaigns.
Those Bill & Ben hats, the paisley collection and then there was the coats with the leather arms which are still yet to disappear off the British high-street.
Bailey is one of the greatest Creative Directors of our time. He’s up there with Tom Ford for a progressive and consistent luxury handwriting. Burberry’s growth and success is down to his balance of updating Britishness while respecting the past and knowing exactly what consumers want now.
While the average Burberry customer probably doesn’t know or care who Christopher Bailey is, for us fashion folk, we like to see the whites of the eyes of those designing and leading the brands we look at.
Seventeen years in fashion is a lifetime, especially today, and while “See Now, Buy Now” pushed him into a creative cul-de-sac, Bailey produced some great clothes and images.
I think he’ll probably take a break. Burberry has made him a very rich man. But, it is exciting what this talented man decides to do next. Perhaps he’ll join Angela Ahrendts at Apple, maybe a bigger fashion job such as Louis Vuitton, his own label or maybe something really radical like Amazon. Who knows?
See more Burberry related comment pieces:
Time to Ditch “See Now, Buy Now” here
Choose Your Rip-Off here