Burberry is continuing to make inroads with a younger demographic, reporting a 26-per-cent lift in sales of goods at full-price in the latest quarter driven by new customers.
“Full-price sales continued to grow at a double-digit percentage compared with two years ago, accelerating from the previous quarter and reflecting a higher quality business,” said chair Gerry Murphy, releasing unaudited quarterly results today.
“Regionally, full-price comparable-store sales were driven by continued strong performance in the Americas, a material sequential improvement in Asia Pacific as Covid-19 restrictions eased and improving trends in EMEIA despite an ongoing lack of tourism.”
Burberry’s focus on full-price sales data is intended to overshadow the 3-per-cent decline in overall same-store sales as the company pursues a strategy of exiting markdowns.
This approach is setting the luxury brand on a course to achieve year-on-year operating profit growth to 35 per cent, assuming no further changes in the external environment.
Murphy said the company’s outerwear and leather goods categories performed strongly, driven by a younger customer demographic.
“Despite the ongoing challenges of the external environment, we are confident of finishing the year strongly and providing an excellent platform on which to build when our new CEO Jonathan Akeroyd joins in April.”
Another factor the company cites in its improved performance is the rollout of its new store concept with 31 stores now converted, including its second flagship Plaza 66 in Shanghai. Another 19 are expected to be completed by the end of the financial year.
A digital focus has also driven growth.
“We are seeing strong and increasing engagement with customers globally buying online as an outcome of enhancements we have made to the online purchase journey including greater personalisation,” said Murphy.
“We are also seeing strong adoption by customers of omnichannel solutions, including booking store appointments, which we are expanding across more stores and countries.”
An immersive ‘travelling trench’ experience inspired by the Trench Room in the brand’s social retail store in Shenzhen has been expanded into stores across Mainland China where it has generated strong engagement, traffic and sales, he said.
“Building on our partnerships with digital innovators, as part of our outerwear activation on Jeju Island in South Korea, we designed an immersive experience, including Augmented Reality technology that was powered by TikTok and supported strong engagement with our customers.”
Pippa Stephens, a retail analyst at GlobalData, said Burberry’s strong product offer has won over new customers, particularly younger shoppers who find its increased focus on streetwear more attractive, and strong demand for core outerwear and leather goods.
“Burberry’s digital capabilities also drive its relevance and appeal. Having invested in personalisation and social media engagement, including a TikTok campaign centred around its pop-up shop on Jeju island in South Korea, has enabled it to boost awareness,” she said.