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Running Head: BURBERRY BRAND MANAGEMENT ANALYSIS

Burberry Brand Management Analysis Report By (Student’s Name)

Course Institution City Date

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Introduction Brand management is a branding process that involves value added to the products and services of a company. Effective brand management leads to increased customer loyalty, the establishment of brand awareness, and cost leverage. Brand management is a process that requires continued commitment to deliver success. However, brand management is associated with the following benefits; brand scaling, building long-term customer loyalty, creating brand awareness, enhancing price leveraging, and increased sales achieved from increased customer advocacy (Schmidt, 2021, p.1). For successful brand management, some principles should be considered namely: brand equity, brand loyalty, and brand recognition. 

Brand Equity - A principle that creates value for the company through perception, reputation, and impression. It helps in gaining the customer’s loyalty and trust based on the products and services they offer. It is clear that through brand equity, most of the business’ revenue sources come from already existing customers. The following figure is demonstrated of the brand equity of Burberry Company.

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Figure1.0: Burberry’s Brand Equity Source: https://brandburberry.wordpress.com/assignment-1-brand-identity/ 

Brand Loyalty - It involves the devotion that a customer has to a specific brand in comparison to their competitors. Therefore, the customer purchases a service or a product based on the loyalty they have to a brand. Brand loyalty helps in increasing customer retention. However, one should know that brand loyalty is not the same as customer loyalty. Instead, Customer loyalty involves repeated purchasing of a service or product due to its uniqueness from other brands (KOPP, 2021, p.1).

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Brand Recognition - It is a principle that indicates that the audience can easily identify one of your brand products without even seeing or hearing the brand name. Customers

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may recognize a product through visual and audio elements factors. The brand's visual elements may consist of things like the logo, color scheme, packaging appearance, or a slogan among others while audio is commonly presented through the advertisement jingles of the brand (Tech Target, 2019, p.1). Under successful brand management, one must build a good relationship with their target market. Good branding helps in promoting the growth of the company through increased sales and maintains good client retention. It involves one being committed to delivering products and services up to the customer’s satisfaction (Roberts, 2019, p.1). Brand management is an important aspect of the growth and development of a business. However, there are key issues that should be addressed for successful brand management. While building a brand, one should consider treating the brand products and services of a business as assets, that way the company will be focused on the techniques that involve the building of those assets. The brand vision should be clearly stated and functionally benefits the business as a whole. The vision should be inspiring to the employees and resonating with the customers of the brand. Another issue that should be taken into consideration in brand management is working on innovative ideas through subcategorizing them based on those that help the brand gain a competitive advantage in the market among other brands. Ideas in brand-building are important and they should be executed without minding the budget size as long as they help meeting the brand vision. Another issue is associate with the achievement of integrated digital marketing. It involves considering the marketing communication that fits to widely build the brand name. Also, consider whether the brand is internally built within the company. Wide marketing communication of a brand can be appropriately achieved if the employees are inspired to be part of achieving the brand's vision.

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The other issue is associated with the maintenance of brand relevance. Consider the creation of a clear and yielding brand –portfolio strategy. Finally, to achieve successful brand management, ensure that you leverage the brand assets that promote growth and value addition (Aaker, 2014, p.1). This report will involve a discussion of the brand management and strategy analysis of the Burberry Company. The company will also consider business information, strategic goals, consumer analysis, competitor analysis, brand positioning, tactical actions, and the key performance indicators of Burberry. Burberry Business Model Burberry is one of the largest companies in British luxurious Fashion. The company was started by Thomas Burberry in 1856. At the age of 21, Thomas opened his store in Basingstoke, Hampshire, England where he became a famous outdoor wear designer by 1870. Since the company was started, its brand has been known to be forward-thinking ever. Burberry is not only known to design and sell clothes but it is also known to have the innovations of a weatherproof cotton material referred to as gabardine and was invented by the founder of the company in 1879. Most of the trench coats designed by this company are made from weatherproof cotton material. Way before Burberry discovered that gabardine would be used in fashion, it was used by military officers, polar explorers, aviators, and race cars. The first store shop for Burberry located in London was started in 1891 (Burberry, 2019, p.21) Today, the company has 200 brand stores across the world and it is continually building more networks. The company is also increasing its online business where it is existing in more than 40 states worldwide. The company has been gaining a competitive advantage from the classic Trench Coat ever since World War 1 and the product has helped build a strong brand

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reputation. The unique classic style and history of the coat have demonstrated it to be a major selling brand product that has sustained the competitive advantage of the company up to date. The main mission of the company is to sell British fashion design to the rest of the world. Burberry’s Fashion design entails women, men, and children's clothes, fragrances, cosmetics, and accessories. The company has been experiencing growth due to its expansion into the international market. The company is also existing in emerging economies like India and China through the stores that are already established in those areas. Burberry has networked through wholesaling, retailing, and selling through a store in international markets in Asia, the USA, and Europe as well. In the line of cosmetics, Burberry also sells men's products like shaving equipment, moisturizers, facial treatments, and cleansers. It also deals with women's products like fragrances, makeup, hair care bathing, body and skincare products (Burberry, 2019, p.27). Strategic Analysis Strategic Analysis involves researching a business and the environments it’s operating in as a way of formulating a strategy (Downey, 2007, p.3). Burberry strategy was launched at end of 2017 and the strategic focus of the company is rooted in luxury fashion. The strategic goals and objectives of this brand help the company to achieve brand success. Objectives and goals of the brand 

The strategic goal of the company is to maintain creativity thus helping the brand source out new customers and retain the existing ones. Along with the transformation path of the brand, there are two phases taken into consideration; building the foundation and acceleration and growth. The building the foundation phase involves management of the creative and innovative transition, re-energizing of the brand and making investments as

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an alignment of the distribution of the company while accelerating and growth involves full completion of brand transformation (Burberry, 2021, p.1). 

Burberry also aims at delivering the best to its customers by offering quality and unique products.

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The company also aims at creating more brand awareness and reaching out to a wide variety of customers.

The strategic analysis is categorized into three levels namely: the corporate, business, and organizational strategic levels (Corporate Finance Institute, 2020, p.1). a) Corporate strategic level – Burberry Company has used the international expansion strategy which has widened the market of the organization and increased its profits as well. Based on this specific strategy, Burberry owns international market stores and the main ones are located in New York, Barcelona, and London. The international markets of Burberry have expanded to the Asian and Japanese markets (Lee, 2012, p.24). The company is also entering other emerging markets in the Middle East Region. The company has kept on opening new stores from time to time. b) Business strategic level - Based on this level, Burberry focused its business operations on franchise leverage and growth acceleration expanding its retail networks. Burberry has also expanded the business through the introduction of non-apparel products. The company has also been exploring and researching information technology as a technique for improving its business performance. Burberry is also using social networks like Instagram, Twitter, and Facebook which have helped in maintaining close relationships with their customers. Due to

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the strong influence of social media, the company was not affected by the negative impact brought by the recent global recessions. Burberry also introduced a digital strategy which has made the company be recognized as the first one in the luxury industry to stream live fashion products and services. c) Organizational strategic level - Through numerous initiatives that the company has been involved in, Burberry has sought operational excellence. The company has been introducing new information technology systems like the SAP leading to development. The SAP has enabled Burberry to easily hold data for all the employees working under the organization from different states. The new IT system has led to the proper coordination of the regional stores under the company. 

External environment Analysis - PESTLE

Political factors Since Burberry operates in international markets, the company has been adhering to the policies and regulations of those states. The corporation also sources raw materials from different parts of the world which subjects Burberry activities to the various regulations in these international countries. Burberry has been setting legal systems in the emerging market to monitor its business performance. Before making any decisions, the company also relies on the risk assurance department which monitors its market developments. Economic factors There was a global economic crisis in 2008 that led to the downfall of the UK’s economy and other parts of the world as well. The economic crisis also led to high inflationary rates recorded. Due to the weakened economy, consumers reduced spending on luxury goods and they

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prioritized basic commodities like shelter and food. Burberry was one of the most affected companies during the economic crisis since there was a large decrease in sales of such companies. Socio-cultural Burberry has been known to demonstrate Britishness through its luxury fashion. The brand has become popular due to innovations like democratic luxury positioning, authentic outwear heritage, and historical icons like the Prorsum trademark and trench coats designed by the company. The company will explore different social cultures based on the fact that Burberry is expanding in international markets. Technological factors Burberry has been using Information technology in its developments. The company has exploited the advantages that come along with the use of social media networks. Burberry launched a website that has made it possible for online customers to make purchases. The company has also largely maintained contact with the customer base through online platforms like Twitter and Facebook among others. Burberry brand is continually increasing digitalization considering that it has developed a 3D technology in fashion and pioneered live streaming as well. Environmental factors In the various states in which Burberry is carrying out its business operations, there are different regulations related to environmental management. It has posed the company to a challenge since it is quite an expensive meeting all environmental regulations of all the states it’s operating in. However, the company is learning to adopt the recycling of its products as a new focus on environmental management.

BURBERRY BRAND MANAGEMENT ANALYSIS 10 Legal factors Burberry has been experiencing a problem with its products’ imitations. The company has therefore made trademark policies and spent a lot of money in fighting the counterfeits. Burberry has collaborated with the law authorities in tracing the counterfeits and suing the perpetrators (Fern Fort University, 2020, p.1). Internal Environment Analysis Strengths Burberry has got a global footprint considering that its products are existing in the international markets. Burberry is existing in four major global regions namely Asia Pacific, Europe, America, and the rest of the world. Due to its diversified business operations across the globe, Burberry is gaining more benefits like increased profits. The company has also gained global recognition as a brand in the luxury fashion industry. Burberry is selling its products through wholesale, retail, e-commerce, and licensing distribution channels. The diversified operations by Burberry have help Burberry get a wider customer base, grow in the emerging markets, and develop a stronger brand presence (Bhasin, 2019, p.1). Weakness One of the main weaknesses that Burberry is exposed to is that as far as credit management is concern, the account receivable of the company read that they have been increased doubtful debts. The increased economic crisis like the recession indicates that the credit defaulter will be more thus influencing the financial position of Burberry in a negative way. Consumer Analysis

BURBERRY BRAND MANAGEMENT ANALYSIS 11 Burberry has been working to ensure that it delivers the best to its consumers. The company gets a deeper understanding of the needs of its customers. The company is also researching its target markets thus getting a good understanding of the desired luxury fashion of their consumers. Burberry uses consumer insights to improve its customer’s proposition. The brand products are offered up to the satisfaction of their clients and customers enjoy the fact that they are valued by this brand. However, this brand can change the attitude of the customers by changing its products according to their tastes and preferences. Burberry is also working hard to use proper and enhanced customer service is given to their clients. The company is has improved its customer care service where they are delivering consultation services both daytime and night using various means like the telephone, social platforms, emails, and website chats. The company has also introduced the use of various languages approximating fourteen when offering assistance to customers. Burberry also engages their customer through interactions over the digital platform where they can easily express their opinions about the brand. The customers’ ideas are analyzed and response is given to the appropriate. The brand can learn the areas they need to improve on based on the products and services they offer in the market (Burberry, 2018, p.62). It also helps in creating brand awareness for consumers who are not aware of the brand once they come across it on social media. Competitive Analysis The uniqueness and quality provided by Burberry is one aspect that makes Burberry be a winning brand in the luxury market. The brand also researches more on the strategies it can implement for the company to maintain its competitive advantage. The competitive analysis for Burberry will be analyzed through porter’s five-force model.

BURBERRY BRAND MANAGEMENT ANALYSIS 12 Power of Buyers In most cases, the buying power highly depends on economic power. The rich are rarely affected by the economic cycles due to their high net worth. This is a clear indication that the buyers are categorized and there is increased bargaining power in the market. The customers with low bargaining power in the market put more pressure on fashion designs and trends. It is difficult to achieve equilibrium in the luxury fashion industry due to the two different categories of buyers in existence. Power of suppliers The existing market segments help determine the power of the suppliers. An increase in bargaining power leads to a concentration trend and vertical integration. Generally, the luxury fashion industry has posed limitations in the concentration of suppliers. Established market players in the industry may help small-scale suppliers raise their standards in comparison to competitors on supplies (Anthony et. al, 2014, p.2). Level of rivalry Burberry Company is in an industry that relatively has high competition. The basis of competition in this industry is not based on product prices but relies on the quality and image perception of the products. Competition in the luxury fashion industry also relies on how a firm is capable of attracting skilled designers. Threat of entry In the fashion industry, new designers are a threat to entry. However, the new entrant may not pose a threat to all the companies in the industry like Burberry. Burberry has a wellestablished brand name which the customers consider in the industry leaving the company less threatened by the new entrants.

BURBERRY BRAND MANAGEMENT ANALYSIS 13 Threat of substitution There is no existence of real substitutes in the luxury fashion industry. The options that the buyers have is not to purchase the product or good at all due to minimal. Brand Positioning Burberry has positioned itself in the market of the luxurious fashion industry. The company offers fashion products of high quality at low prices in comparison to its competitors. In the luxury market, Burberry has positioned itself in the mid-level segment. However, the company is producing goods of high-quality levels. Burberry is working on an approach that can be used to lower its prices since the company has opened more stores across the world. The company has held a wide market niche due to its existence in the diversification of products and considering various target markets while producing its luxury fashion products (Anthony et. al, 2014, p.10). Tactical actions Other than the quality strategy used by Burberry, the company also considers other strategies like differentiation which helps it in retaining the competitive advantage in the luxurious market. The company also maintains long-term partnerships with vendors that provide the company with unique and high-quality materials making Burberry products outdo those of the other brands in the market (Burberry, 2021, p.1).

Key performance indicators KPIs of Burberry are the revenues’ growth of the company, comparison on the growth of sales, growth of adjustments of the operating profits, adjustment of the operating profit margin, growth of profit before tax, growth of diluted EPS, and adjustments of the retail wholesale

BURBERRY BRAND MANAGEMENT ANALYSIS 14 ROIC. The revenue growth involves the measurement of the Burberry brand demonstrate by the sales channel they use to reach the customers. D...