Burberry Case Study: Repositioning Strategies in the Luxury Market

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ASSIGNMENT 2: CASE STUDY ON BURBERRY
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Table of contents
Introduction......................................................................................................................................2
1. Importance of positioning, repositioning and its relevance.........................................................3
2. Demonstration of position mapping............................................................................................3
3. Two methods for achieving repositioning...................................................................................6
Conclusion.......................................................................................................................................6
Reference list...................................................................................................................................7
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Introduction
In order to extend business, organisations need to introduce new product for holding their
position in market. In this study, Burberry wants to develop their position by introducing new
leather goods. Hence, using case study, importance of positioning and repositioning will be
discussed. Addressing the marketing related issue of Coach and Mulberry such as excessive price
and old designed products, new ways of repositioning for Burberry will be negotiated throughout
the study.
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1. Importance of positioning, repositioning and its relevance
Importance of positioning and repositioning
In the opinion of Blankson (2016), the organisations need to know about their position in market
so that they can develop their products for increasing profit level. In time of marketing for
products, marketers need to focus on their brand and its demand to customers. It is quite natural
that if customers want to get the specific branded product, the work of marketers becomes easy
and they can easily attract customers towards them. Going through the case study, it is noticed
that in 2017, Burberry was able to increase around 10% of their sale in accessories department.
Therefore, marketers of Burberry know that customers are fond of their accessories like
handbags and small leather goods. In this section, their position is high or almost same
comparing with Gucci, Mulberry and Primark. Thus, it can be stated that if Burberry wants to
develop their position, they need to bring improvement in their luxury products. Therefore,
positioning of brand is important for communicating with customers and repositioning helps to
make customer know about the new or developed product of brand in contemporary market.
Thus, reposition can increase sale of products in the merchandise market.
Implications for business performance
In case of organisation is able to reposition its product by maintaining the concept of high
quality low price, it helps to develop their profit. As per the case scenario of Burberry, if they
are able to introduce the luxury items and target 16-24 years for selling product, it can increase
their sale. As a result, they can invest more money for improving performance of workers. On
the other hand, it is also found that market was facing weak sterling due to EU referendum. It has
indicated the economic instability in market. Hence, introducing luxury item in low price, the
marketers of Burberry can attract huge customers towards them. It will provide reputation in
the contemporary market.
2. Demonstration of position mapping
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High Quality
Low Quality
Low Price High Price
Figure 1: Current position of Burberry
(Source: Created by learner)
Position mapping states about the product quality based on its price. At present, the position of
Burberry is high quality high price. The position of Primark and Gucci is also same. Hence,
only customers, who have stable financial status, can afford Burberry. In this context, Burberry
deals with limited customers (Academic.mintel.com, 2019). However, as it is able to provide
high quality product with high price, it cannot attract all types of customers due to excessive
price rate. As mentioned by Maison (2018), if organisation is able to make people aware of their
new positioning, it can give fruitful outcome. In context of Burberry, as it will attract all types of
customers, especially who belong to 16-24 years; they need to reposition their product by
reducing its price rate in market. It will help them to bring growth in the business of Burberry.
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High Quality
Low Quality
High PriceLow Price
Figure 2: Repositioning of Burberry
(Source: Created by learner)
It is noticed that in market, there are numerous luxury brands like Primark, Gucci, Mulberry and
many others. In case of Burberry, it will need to compete with them. As per the present position-
mapping diagram of Burberry, it is observed that all brands are present in the high quality high
price section. In this context, customers, who do not have financial stability, cannot afford the
products. In order to resolve the above-mentioned issue, Burberry can reduce costing of product
as they can get the position of high quality low price section. They will also bring new luxury
small goods in market and target young generation, belonging to 16-24 years, as they have
eagerness to try new accessories of various brand. Thus, Burberry can earn growth in their
business.
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3. Two methods for achieving repositioning
Analysing customer requirement
In time of repositioning, as mentioned by Grimpe et al. (2015), organisation can give priority to
the requirement of customers. In case of Burberry, it found out that young customers want to use
new accessories. Many brands like Gucci and Primark are there, who offer this kind of products
in high price. In this context, in order to achieve repositioning, they need to provide same
product in low price. In addition to this, Luxury designers like Prada and Kors do not focus on
designing handbags. Burberry uses this news and brings improvement in their handbags and
leather goods within low price for achieving repositioning.
Uniqueness in product and low cost
On the contrary, Ju et al. (2018) commented that company focuses on the customer demand and
based on it, tries to bring uniqueness in their product. It is quite natural that if company is able to
meet customer demand, it can increase their sale. In addition to this, company needs to offer new
product low price comparing with other brands like Gucci, Primark and many others. Hence, in
case of Burberry, they will design handbag in a new way for attracting customers. They will also
maintain the price of product for achieving reposition in the market.
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Conclusion
In order to conclude the study, it can be stated that marketers need to know customer demand
and based on it, they make people know about their position in market. Many a times, customer
does not know about repositioning of brand. Throughout the study, importance of positioning,
repositioning is analysed. Ways of achieving repositioning, such as maintaining customer
requirement, product uniqueness, by Burberry are negotiated in order to get fruitful outcome in
competitive market.
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Reference list
Academic.mintel.com. 2019. Designer Fashion - UK - November 2017 - Market Research
Report. [online] Available at: http://academic.mintel.com/display/793889/?__cc=1 [Accessed 14
Mar. 2019].
Blankson, C., 2016. Positioning a brand. The Routledge companion to contemporary brand
management, pp.164-185.
Grimpe, C., Sofka, W., Bhargava, M. and Chatterjee, R., 2015. Novel but too complex? The
importance of marketing innovation for new product performance. In The DRUID Society
Conference 2015, 45(2), pp.78-100.
Ju, M., Jin, J.L. and Zhou, K.Z., 2018. How can international ventures utilize marketing
capability in emerging markets? Its contingent effect on new product development. Journal of
International Marketing, 26(4), pp.1-17.
Maison, D., 2018. Qualitative Marketing Research: Understanding Consumer Behaviour.
Abingdon: Routledge.
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