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Financial Analysis in Burberry Group PDF

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Added on  2021-10-13

Financial Analysis in Burberry Group PDF

   Added on 2021-10-13

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Brand Audit Project
Final Report
Company: Burberry
Group: Jasmine Roscoe,
Jessica Johnson, Mardreas
Jones, Sierra Lowery
FTM 382
Spring 2012
Instructor: Dr. Xu
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Financial Analysis in Burberry Group PDF_1
Table Of Contents
A. Executive Summary 3
B. Company History & Background 3
C. Objective 4
D. Industry Analysis
Product Market Analysis 4
Financial Analysis 5
SWOT Analysis 6
Competitors 7
E. Brand Inventory 8
Target Markets 8
Marketing Program 8
Brand Architecture 9
Brand Personality, Elements, and Mantra 11
Competitor Analysis 12
Brand Inventory Assessment 13
F. Brand Exploratory 14
Market Observation 14
Brand Awareness and Association Assessment 14
G. Reccomendations 16
Branding Strategies 16
Brand Marketing Programs 17
Secondary Associations and IMC Proposal 19
References 22
Appendix 24
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A. Executive Summary
This brand audit evaluates the industry presence of Burberry and provides recommendations
in order for the company to increase it’s market share. The objectives of this audit are:
-to identify current place industry
-to evaluate current marketing procedures in place
-to observe consumer sentiment
-to recommend ways for Burberry to enhance it’s current position
In this analysis the marketing and product mix are heavily analyzed. Burberry offers a
variety of product and different price points, as well as conducts intense marketing
campaigns. The findings of the effectiveness of these were very high, but there is still room
for improvement. The company does an amazing job reaching inside and outside of its
customer base. The hope of the company is to be on the mind of those who can and cannot
afford the products, because those who can will buy and those who can’t will associate
prestige with the company and when they can afford the product they will shop there.
Recommendations made were generally dealing with how to increase marketing
effectiveness and relevance when dealing with their target market. Other recommendations
were made dealing with the evaluative approach the company uses as well as offered a new
modern but timeless look to their brand hangtags.
B. Company History & Background
Burberry was founded by Thomas Burberry in 1856, in Basingstoke, Hampshire, England. At
the time Burberry worked as a draper’s apprentice and was only twenty one years of age. By
1870 the small shop started by Burberry had grown into an “emporium” that focused on
outdoors attire. In 1879 Burberry invented garbardine, a fabric that is waterproof and
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durable but breathable. A patent was taken out on the fabric in 1888. In 1891 the company
opened a store in the west end of London and in 1895 developed the Tielocken, the
precursor to the trench coat. In 1901 the trademark Equestrian Knight accompanied by the
work “prorsum” first appeared. In 1914 the creation of the iconic trench coat occured and
has been the staple of the Burberry brand ever since. In the 1920’s the Burberry Check was
introduced to the brand. From 1856 to 1955 Burberry was an independent company, in 1955
it was taken over by Great Universal Stores. The company flourished and in 2002 was
initially introduced to the London Stock Exchange.
C.Objective
The purpose of brand audit is to utilize the select evaluative tools learned throughout
the course to analyze Burberry’s industry presence in comparison to its competitors.
The goal is to uncover the strengths, weaknesses, opportunities and threats and
provide suggestions to increase the brand’s market position.
D. Industry Analysis
Product Market Analysis
Burberry is a leading luxury brand in the world market. Due to it’s wide product mix
Burberry is able to cater to a number of markets. Outerwear remains the core of the
Burberry apparel business, from timeless iconic pieces to innovative contemporary styles.
Outerwear accounted for over half of their retail apparel sales during the year. In
2006-2007 Burberry historically licensed the first full in-house global menswear collection.
This first collection reported growth of 31 percent in menswear. Building childrenswear
remains a key focus for the company. Childrenswear integrated into the global company in
2010, with the division now located in the company London headquarters. Non-apparel
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remains the main growth of the company contributing 40 percent of retail and wholesale
sales during the year. Large leather good are a high seller of the Burberry non-apparel
business, representing about 50 percent of revenues in its category. Men’s accessories was
amongst the strongest performing categories. Women’s shoes represent an important growth
opportunity for Burberry reaching 7 percent of mainline sales in 2011. Boots, performed
particularly strongly (www.burberryplc.com).
In June 2010, Burberry launched its first cosmetics line, Burberry Beauty. Bring
focus of attention on natural, effortless beauty. Burberry Beauty first introduced as a test
format through a limited number of wholesale partners globally and to customers on
burberry.com. Burberry Beauty supported by Burberry advertisement campaigns and runway
shows, experienced a strong early response from consumers and press as it approached its
first year anniversary. Burberry has three global licensing agreements with fragrance,
timepieces, and eyewear (www.burberryplc.com).
The Burberry store is a luxury brand with a distinctive British sensibility, strong
international recognition and differentiating brand values that resonate across multi-
generational and duel-gender audiences. Since its founding in England in 1856, Burberry
has been known for quality, innovation and style (www.beverlycenter.com).
Financial Analysis
Burberry’s revenue has increased steadily over the past four years. In the fiscal year
ending in March 2011, Burberry reported revenues of approximately $2,336.2 million (Data
Monitor, 2011). In comparison to the previous fiscal year, this was a total increase of over
25%. The group's operating profit was $465.1 million in fiscal 2011, and the net profit was
$324.3 million (Data Monitor, 2011). Burberry generates revenue through retail (also
including e-commerce), wholesale and licensing. For the 2010-2011 year, retail accounted
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for approximately 64% of revenue, wholesale 29% and licensing 7% (Data Monitor, 2011).
The products that generated the most revenue in 2011 were non-apparel items such as
leather goods and the Burberry Body fragrance. Women and men apparel products followed
in second and third place respectively. Children’s wear generated the least amount of
revenue in 2011.
SWOT Analysis
Burberry has a goal of continuing to hold “great brands [that] project a pure,
consistent experience across all channels in order to standout in today’s cluttered consumer
arena.” (Data Monitor, 2011) The “pure and consistent experience” is maintained through
authenticity and integrity that allows all consumers to trust the heritage brand and continue
to shop their products. In addition to consistent and trustworthy products, Burberry focuses
on investing in their team culture by reinforcing company values. The company functions on
the principle that the Burberry brand is “the touchstone against which all activity is
measured” (Data Monitor, 2011).
In addition to upholding brand integrity, Burberry has focuses on operating under high
quality standards through an ethical supply chain and other responsible operations and
focuses on Corporate Responsibility. Since 1856, Burberry has operated under the belief that
to be a great brand you also need to be a great company” (Burberry plc, 2011). Currently
they tackle “issues related to climate change; and efforts to inspire employees on issues of
ethical trade, environmental sustainability and community investment” (Burberry plc,
2011).
While the heritage and consistency is a strength within the company, it has proven to
be an issue in modern times. In the past decade, the company began “revitalizing the
Burberry [by addressing] inconsistencies with the modern democratic luxury positioning
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Financial Analysis in Burberry Group PDF_6

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