Burberry Aims to Resurge with Focus on Iconic Pieces and American Market
London - British luxury brand Burberry eyes a positive holiday season performance as investors anticipate progress in its turnaround efforts. Led by CEO Joshua Schulman for six months, Burberry intends to revitalize its brand and regain market share by emphasizing its signature trench coats.
Since September, Burberry shares have surged 70%, indicating investor optimism. Analysts forecast a 12% comparable sales decline for the quarter ending December 2023, an improvement from the 20% drop in the previous six months.
Schulman has expressed plans to enhance Burberry's standing in the United States. The brand's pricing strategy points to anticipation of increased US demand, with a significant 115% increase in its top price point.
Anna Farmbrough, a portfolio manager, notes Schulman's excitement about Burberry's potential in the US market. Farmbrough believes his connections from his time at Coach could assist the brand in gaining prominence.
Heritage and Affordability
Burberry's recent advertising campaigns showcase its classic trench coats and scarves. The brand aims to win back alienated customers with recognizable designs and lower pricing. Schulman's lack of specific financial targets provides flexibility for growth without disappointing investors.
Analyst Thomas Chauvet views Burberry's turnaround plan as sound, with a return to fundamental brand elements and a focus on iconic products. Trench coats and scarves historically account for a substantial and profitable portion of sales.
Burberry's immediate objective is to regain its 3 billion pound annual revenue, previously achieved in 2022-2023. Analysts estimate sales for the year ending March 2025 to reach 2.39 billion pounds.
Despite a sale on its website last year, full-price sales of new collections are believed to be unaffected. Burberry remains optimistic about its future as investors anticipate a successful holiday season and a resurgence in the US market.