Analysis of Burberry's Expansion and Management in Asian Markets

This report provides an analysis of Burberry Group PLC's expansion into the Asian market, a British luxury fashion house navigating the complexities of diverse consumer demands. It discusses the challenges faced by Burberry, including adapting to local tastes, managing supply chains, and dealing with economic and political factors. The report also explores the strategies employed by Burberry, such as flagship stores, organic growth, and mergers and acquisitions, to establish a presence and appeal to Asian consumers. Furthermore, the report touches upon the company's internationalization approach, encompassing both visible retail presence and invisible aspects like international sourcing and cross-border management. The impact of factors such as corruption crackdowns in China and socio-cultural differences on Burberry's performance is also examined, highlighting the need for adaptable business models and marketing tactics.

Assessment 2 – Individual Assignment
Managing across borders
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Contents
Executive Summary:........................................................................................................................3
Introduction:....................................................................................................................................4
Main Body: Topic 1: Global fashion brand and its expansion in Asian market..............................5
Conclusion:....................................................................................................................................10
References:....................................................................................................................................11
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Executive Summary:
The tasks are completed in the context of fashion houses that are expanded across the borders of
Asia and have been dealing with the chaos of Asian market. The company selected for the report
is Burberry which is a British Luxury Fashion house With regards to item Burberry is the most
put stock in garments marks in the UK. It continues raising the requests for its profitable items
through the country. As every one of the results of Burberry are aftereffects of spectacular
craftsmanship the cost achieves a premium level.
Burberry utilizes visual media for the limited time exercises and they sign popular big names for
their promotion campaigns. In the task, the critiques and the approaches to the term
internationalisation after incorporating the clear analysis and the strategies will be done. At the
time of expanding the company to international levels, there are many points that are to be
covered so that the company can establish its roots in the new market.
In the Asian market, it is complex to provide services as the demands of the consumers turn
versatile and complex. The Asian market is filled with challenges and profits for which the
fashion houses like Burberry need to alter their fashion services as per the demands of the clients
to earn a higher number of profits. The companies need to have decent knowledge about the new
markets before expansion so that they can take necessary actions to market their products. The
challenges that will be faced by the Burberry will be discussed in the report that can create a
barrier to their services.
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Introduction:
Burberry Group PLC is one of the major fashion houses dealing with luxury fashion services.
The headquarters of this company is in London, England. More than 500 outlets of Burberry are
found in excess of 50 nations which makes this organization a pioneer. The report will be
discussing the major challenges that Burberry Group PLC had to face at the time of launching
their services to the Asian market. The demands of the Asian market are quite diverse from the
other countries and the services need to be altered as per their desires. This mark utilizes two
showcasing blends which are mass advertising and speciality showcasing in their process.
Burberry is the main brand in the UK which demonstrates the energy of bundling; its appealing
logo on the parcels is extremely a charm.
Burberry has its outlets all over the UK, which gives straightforwardness to the customers
obtaining its items. The report will also be covering the major strategies and tactics that Burberry
Group PLC had to use so that they can attract the customers to their unique products and
services. The critique sand the approach of internationalisation will also be discussed in the
assignment below. There are many of the steps which require detailed study before
implementation into a new market. These steps can result in success or failure of the company.
If the company analyses the whole market conditions before investing in a new market then they
can profitably earn market reputation. There are certain services which will need alteration in the
Asian marketplace as the taste of fashion in this market is quite diverse from all other segments
of the market. The services that are provided all over Asia can generate profit after utilising the
best marketing strategies as this market is vast and easy to capture.
The competition between Burberry Group PLC and other companies providing similar kind of
products and services can be cut throat but the profits can be worth it. There are certain
stepladders to be followed for capturing the mind of Australian consumers which requires great
tactics. Burberry Group PLC can successfully distribute their services to the clients throughout
Asia with the assistance of their stores that provide a complete range of their customised
services. The report will be addressing the diverse needs of the group that are required for
stepping into the Asian market, as managing business across borders is a rigid task.
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Main Body: Topic 1: Global fashion brand and its expansion in Asian market
The research essay will be based on Burberry Group PLC which is a luxury fashion house from
London and has been covering the Asian market from past few years. The company has high
brand value and provides great customer satisfaction in terms of their services. The essay covers
the problems that were faced by the Burberry Group PLC at the time of entering Asian markets.
The famous problems that were faced by the Burberry Group PLC at the time of entering Asian
markets logo were registered in 1920, the red, white, black and the camel neck which is known
as Nova has become an identity of Burberry Group PLC. The products of Burberry Group PLC
are alienated between the collections and fragrances (Fawzy, 2015).
The collections of Burberry Group PLC incorporate Burberry Prorsum, Burberry Golf, Burberry
London, Eyewear and Timepieces. Burberry Group PLC has been trying to expand their services
worldwide and has been updating all their stores continuously. The first Asian store of Burberry
Group PLC was located in Taj Hotel, Mumbai, India. In the Asian segment, Burberry Group
PLC explored its ways to enter in countries like China where it experienced an expansion of
channels due to the fuelling of desires from the Mainland. There was a great chance to increase
their products and stores throughout China as the economy of China was continuously increasing
and so were the high-class individuals. Burberry Group PLC tried many tactics to enter the new
markets like utilising the Global mess as an advantage (Heikkurinen and Bonnedahl, 2013).
Burberry Group PLC is present on the top end of the market and from the past decades, it has
been sustained on massive appeal which can be seen by the business margins. The general
market of Burberry Group PLC has been living under the weight of many uncorrected excesses
and it has been only establishments interference which keeps the whole system altogether. The
financial system of Burberry Group PLC in Asia looked like on a brim of a catastrophe. The
situation of Burberry Group PLC in the Chinese market is quite decent than the other markets. If
the Chinese market keeps on rising at similar speed then the recovery of consumption can be
done in China as well as other closely related Asian countries. By adoption of diverse business
models, Burberry Group PLC has developed its performance to unfavourable (Jersey, 2013).
The shares of Burberry Group PLC were hauled down after the warning, as per the company
sales of this fashion house decreased due to the highly challengeable environment for the luxury
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services. Some of the analysts also commented that the governance of Burberry Group PLC has
been limiting and generating a barrier to its flexibility. Burberry Group PLC utilized a strategy of
like for like sales which resulted in a failure in Hong Kong which was a failure of 20 percent.
Around 25 % of the sales made by Burberry Group PLC are accounted to the greater China. The
main reason for hitting over demand in China was due to the corruption crackdown which was
established by the President of China Xi Jinping in 2012. This step made it a taboo to display the
expensive luxury watches and other designer accessories (De Mooij, 2013).
Luxury brands all over the globe have the strength of branding due to which they can easily
impact the societies and cultures of individuals in diverse marketplaces. The main core
characteristic of Burberry Group PLC is its strength, innovation, creativity, differentiation,
craftsmanship and exclusivity. The additional core physiognomies of this brand are a high brand
image, strong reputation and the higher emotional appeal. The internationalisation of Burberry
Group PLC has been seen of visible as well as invisible dimensions. The invisible dimensions of
the group are determined as the international sourcing service and the cross-border transmission
management proficiency in the form of managerial skills (Zhang, et. al, 2014).
The visible dimensions of Burberry Group PLC’s internationalisation are the process of the retail
shops within the Asian markets and consequently, the Burberry Group PLC is visible in the
market. Burberry Group PLC has received the Royal Warrant twice till now and they have
established them form mere manufacturers to a luxury brand all over the Globe. Burberry Group
PLC has robust retention of the brand but there is limited product line. In political ways, the
unmistakable countries in which Burberry defects require the relationship to submit to their
neighbourhood employs, one of a kind laws, which can be ghastly to the working of Burberry
Group PLC here and furthermore their political trickiness annoys the supply chains and stores
(Okonkwo, 2016).
Economic crashes influence the blemish of Burberry Group PLC, the greater part of the
travellers going by the UK buy its items in light of its interesting standard which is influenced by
financial downturns. In socio-social, the clothing regulations of purchasers shift from place to
place to manage it Burberry Group PLC draws in with huge numbers of the social exercises
which help it in getting more learning about the customers. Burberry Group PLC collections like
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jeans are delivered utilizing characteristic cotton downy that can't harm the earth. A
commonplace disaster is normally difficult to envision as nobody knows when it will happen
(Burns, et. al, 2016).
Burberry Group PLC withstands every one of the principles proposed in the specific nations they
are working to shield from any escape clause in the work. Burberry is one of the key parts of
promoting the capacity of tactics, they are the short term ideas which are actualized considering
that with the end goal to pull in the objective customers. To accomplish the settled targets and
objectives of an organization for business across borders diverse strategies are taken after, some
of them are an operational strategy, finance strategy and performance management (Liu, et. al,
2016).
The operations arrangement of Burberry Group PLC is the total strong exercises picked or
empowered by corporate strategies. It fuses setting up a couple of workplaces close to their goal
customers in Asia, moving to more reasonable quarters placing assets into improved plant and
outfit and changing the season of activity to create upwardly or cut down the expenses of
remaining with the open. The monetary system can help Burberry Group PLC to set targets and
make it less complex for the brand to work towards a more extraordinary and stable wage mix.
This incorporates its investigation of primary dangers, hold approaches, subsidizing destinations,
money related circumstance et cetera (Shah and Zhao, 2016).
Burberry Group PLC should utilize execution estimations to quantify in insight about what is
normal from the representatives in connection with particular targets of business. This, as a rule,
identifies with nature of execution, how quick exercises are finished or whether the undertakings
are finished inside the arranged budget for expansion in Asian areas. Burberry Group PLC
furthermore ought to be dynamic to the point that inspiration driving time where all systems
change into an advantage. Before spreading the strategy every item and association which will be
offered ought to be checked well so the customers won't get affected in any sort of negative way
and get the best results of best quality conveyed. The basic strategies that Burberry Group PLC
utilized to enter the foreign markets where of flagship stores which were operated in the most
Porsche areas of the countries and organic growth in which the internal expansion was done by
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Burberry Group PLC like developed new stores with an internal organisational structure (Dave,
et. al, 2014).
The strategy of merger and acquisition was also utilised by them. Burberry Group PLC also
analysed the foreign markets and then took necessary steps which affected their performance in
certain regions. The main reason behind purchasing the local franchise in Mainland China for
Burberry Group PLC was to get more control over the merchandise. Burberry Group PLC has
been operating its flagship in four markets that are London New York, Barcelona and Tokyo.
There are three very crucial impacts on the internationalisation process of Burberry Group PLC
as per the electric Paradigm theory. The possession profit possessed by the company in the Asian
markets is one of the first and the foremost fact. The second factor that influences is the
advantage of the location which permits Burberry Group PLC to have right contact with the raw
materials, low wages, special taxes and so on. As per the theory, the third factor is of
internalization advantage (Tse and Wright, 2014).
As per the Uppsala Model, various numbers of steps that are incorporated in the
internationalisation process is of internalization with no exports which serve as the first basic
step after which the exports are started and then it forms the second group and the third one
where the autonomous subordinates are hired in the organisation. The last step for Burberry
Group PLC is of the establishment of the holdings. Burberry Group PLC is said as an iconic
brand which has a great history of exploration at the time of entering Asian market there were
certain challenges that they had to face at the time of entering new markets like there were so
many customers but Burberry Group PLC had very little time to fulfil the demand of the clients.
This was a major risk by the company the demands of the customer were of high risk and the
desires were hard to fulfil as they were continuously changing as per the market trends (Burns,
et. al, 2016).
The chief problem was to provide quality products at so little time and proving their brand
against so many clients. The major steps that Burberry Group PLC took to solve this problem
were to update their prices and provide its knowledge at each possible place, then they try to
determine all the retailers and invite them to sell their services. The second major problem was
of trade show dilemma where more and more brand is asked about the major questions of
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fashion trends in the market. The taste of fashion in Asian countries was diverse from other
countries where Burberry Group PLC operated. The third major problem faced by Burberry
Group PLC was of lack of time for investing in the digital solutions. For Burberry Group PLC
product is at their heart of transformation, they continuously reshape their offers by enhancing
and interrogating the contents of fashion. They also create their own compelling luxury goods of
leathers and other accessories for luring the clients. They keep on building their strengths of
apparels. They also develop their offers to provide a complete look for their clients (Jersey,
2013).
In Burberry Group PLC communication can assist in conveying new energy to the customers.
Burberry Group PLC keeps their products and services at the centre of their communication,
they are also bold in the way they engage their clients. In managing the business across borders
for Burberry Group PLC their customer's experience is the way of reflecting their positioning,
for safeguarding their distribution is reliable with their positioning of branding, they will be
rationalising the non-luxury wholesale and the retail outdoors. Burberry Group PLC will
transform them in-store experiences in the new markets by repaying their stores and uplifting
their digital services (Zhang, et. al, 2014).
Burberry Group PLC will be continuing to enhance their digital services by for the personalised
experiences of their clients in the Asian markets. The actions of Burberry Group PLC will be
focused on the productivity and the financial discipline; they will be kept on engaging and
motivating their team members. This step will be reinforcing their cultures and values in the
foreign markets. There are also many ethical problems that are faced by Burberry Group PLC at
the time of starting their services in Asian markets. There were a lot of problems related to
understanding the demands of clients and competing with the other competitors that were
providing similar kind of services in the market. Burberry Group PLC still continues to be a
leader in the industry as per their responsibilities. The main strength of the Burberry Group PLC
is the product uniqueness that separates them from their competitors and makes their products
much desirable than their competitors (Liu, et. al, 2016).
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Conclusion:
As per the research essay above it can be concluded that Burberry Group PLC has been facing
diverse challenges at the time of entering the Asian markets, these challenges are hard to crack
but Burberry Group PLC has been continuously taking steps to deal with such kind of situation.
The initial steps that Burberry Group PLC took to compete with their challengers in the new
market results in failure at the starting phase but their constant updating in their services
developed their brand image. As per the report, it can be said that in the internationalisation
phase Burberry Group PLC has certain issues in the China market due to the corruption
crackdown policies applied by the President of China.
The first store of Burberry Group PLC in the Asian market was in Mainland after which it
continuously started opening their stores all over the countries. The brand image was highly
affected by certain wrong steps in the management decision by the Burberry Group PLC but
their constant competition breakdown enhanced their reputation. After the research, it can be
said that Burberry Group PLC has a rich history of satisfying their clients with their unique and
luxurious services. There are many services that Burberry Group PLC had to alter at the time of
opening their stores in the Asian markets. The first store of Burberry Group PLC in Asian
country India was in the Taj Hotel, Mumbai which is a luxury hotel this confirms that Burberry
Group PLC is a luxury brand which assists them to develop their own unique class and provide
their services to the Asian market.
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References:
 Burns, L.D., Mullet, K.K. and Bryant, N.O., 2016. The business of fashion: Designing,
manufacturing, and marketing. Bloomsbury Publishing USA.
 Dave, K., Atwal, G. and Bryson, D., 2014. The Luxury Landscape in India:
Consequences for the Wine Sector. In Luxury Brands in Emerging Markets (pp. 85-95).
Palgrave Macmillan, London.
 De Mooij, M., 2013. Global marketing and advertising: Understanding cultural
paradoxes. Sage Publications. Fawzy, H., 2015. How To Create A Winner Marketing Plan To Your Hospital.
Linkedin,Pulse.
 Heikkurinen, P. and Bonnedahl, K.J., 2013. Corporate Responsibility For Sustainable
Development: A Review And Conceptual Comparison Of Market-And Stakeholder-
Oriented Strategies. Journal Of Cleaner Production, 43, Pp.191-198.
 Jersey, K.L., 2013. Marking Importance In Lectures: Interactive And Textual
Orientation. Applied Linguistics, P.Amt029.
 Liu, S., Perry, P., Moore, C. and Warnaby, G., 2016. The standardization-localization
dilemma of brand communications for luxury fashion retailers' internationalization into
China. Journal of Business Research, 69(1), pp.357-364.
 Okonkwo, U., 2016. Luxury fashion branding: trends, tactics, techniques. Springer.
 Shah, A. and Zhao, L., 2016. Impeding Counterfeiting of Luxury Products in India.
 Tse, T. and Wright, L.T., 2014. Luxury brands and deriving fashion meanings in a Media
Context in Hong Kong. In Luxury Brands in Emerging Markets (pp. 155-164). Palgrave
Macmillan, London.
 Zhang, S.S., van Doorn, J. and Leeflang, P.S., 2014. Does the importance of value, brand
and relationship equity for customer loyalty differ between Eastern and Western
cultures?. International business review, 23(1), pp.284-292.
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