Product Management Report

Bridget Betances, Natalie Burrell, Kellie Butler, Rhecia Harris, Jarek Sliger

Table of Contents
Executive Summary3
Situation Analysis4
Customer Analysis6
Objectives8
Product and Brand Strategy9
Supporting Marketing Programs11
Financials13

Executive Summary:
Designer Thomas Burberry founded Burberry in 1856. He started his brand in the UK, and
now it is a globally successful company. Burberry focuses on luxury British menswear,
womenswear, childrenswear, coats, dresses, shoes, accessories, bags, scarves, beauty and
fragrance. The brand is most famous for their trench coats, which is the product our group
has focused on for this semester. The trench coats are globally popular and symbolize class,
luxury and style. They are also famously known for their tartan pattern they use on most of
their products. The plaid pattern has become very recognizable in the fashion world.
Commitment to its extended global community is at the heart of the Burberry core values: to
protect, explore and inspire, and the business strives to evolve its practices in line with these
principles. Burberry products are sold online, in their own personal stores, and shopping
centers throughout the world.
Us.burberry.com

Situation Analysis
Burberry is a successful international brand that has had many years of history and
excellence under its belt. The company has many different areas of the fashion industry in
line with their corporate culture. As a group of potential product marketers, focusing on the
trench coat category for the company is crucial in order to better identify Burberrys
successful marketing.
When it comes to the category and competitor definition of Burberry they are
fortunately, category killers. Burberry is the leading retailer in sales of trench coats within the
industry. Although they are the leaders in this division of the fashion world, they do have
some competitors who are making their way up the totem pole. Competitors include Michael
Kors, London Fog, Lanvin and Ralph Lauren just to name a few. What these competitors
lack is the strong foundation of history that Burberry posses as a company and especially
within their trench coats. The company is apart of the design, pre and posts production of the
product every step of the way. All of the above competitors, including Burberry can be found
in different brick and mortar stores plus department retailers across the globe. They are all
marketed differently but Burberry has a greater presence within the different media strategies
used for their target market campaigns. The trench coat product category is successful also
due to the number of celebrities who endorse the brand. Creating a global, luxurious style for
trench coats is vital to the Burberry product.
To Burberry, trench coats are a staple item to any wardrobe and closet. The company
itself has brought in over 2, 330 million dollars in revenue for the year of 2014. This allows
for the continued growth of the product category to continue to increase. Over the last several
years expanding globally has been a leading factor in the companys business strategy. Along
with the expansion of the brand, the trench coat category for Burberry has increased profits
up 17% from 2013 to 2014. All of these factors from size, growth and profits permit Burberry

to have an overall positive attractiveness in the product category. The Burberry brand is at the
mature stage in the product life cycle because of its large size, growth and attractiveness
compared to all other competitors in this product category.
The focus on trench coats for Burberry is detailed because they are the primary
leaders of this category. In this category the rivalry is very low due to not many competitors
having experience with the quality of trench coats. One of Burberrys rivals, London Fog,
tends to create their trench products from synthetic fibers rather than the in-house made
fabrics that Burberry creates. This causes for little pressure from industry substitutes to
appear. Due to the complexity of brands producing solely trench coats, the category capacity
is relatively low. This is because there are few companies who produce strictly trench coats.
Brands like Ralph Lauren, Michael Kors and Lanvin introduce trench coats to their seasonal
lines rather than offering them year round. Because many brands do not solely base their
sales or products on trench coats it is an easy market to enter. The threat of new entrants to
Burberry is not high because they are at the top of their niche market making it more difficult
for a new company to engage in this category. The luxurious style of Burberry trench coats
allows for the bargaining power of buyers to be attractive, selling their products to high-end
retailers allows for the mark up to be large. Due to the high demand in Burberry trench coats,
they are implementing more power throughout their supply chain. This permits for the
suppliers to gain the product deliveries at an accelerated pace.
The Burberry trench coat is a clothing item that is classic but still is able to make an
outfit stand out. The sales seasonality of the coat really does make a difference because
depending on where the consumer is purchasing the item; they will have to take into account
the weather in that region. The weather and change of seasons really affects the sales
cyclicity as well because buyers must make purchasing decisions keeping in mind of
different climates that consumers may purchase from. The Burberry trench coats make it easy

to influence consumers that this product is great for all forms of weather. The materials and
usefulness of the outerwear item is very versatile.
Along with being the leading brand in the trench coat category, Burberry focuses on
the environmental factors as well. Their technological focus is based on people, product,
process and property according to their corporate responsibility from their website. Along
with this they engage in advancements in visual merchandising and social media.
Categorizing them as a lifestyle brand, Burberry focuses on their consumer and how the
consumer wants to live their life. Building upon that, they focus on how to market their
trench coats in such style and class of a lavish lifestyle. In political aspects, Burberry expects
all of their suppliers and retailers to comply to labor laws in order to have a transparent
working environment for all. The company practices a health and safety assessment triannually in their retail stores. Economically and socially, the company donates 1% of all
profits annually to charities. This gesture makes the company more prone to what is
happening in the world no matter the circumstance, even though the brand is high-end. The
brand is also responsible for harnessing employees and students by upholding inspiring
individuals of all generations.
Customer Analysis
The product is the Burberry trench coat which is offered in a variety of colors and styles for
women, men, and children but is geared more towards the younger audience. Since it is a
luxury brand, the price is high because you are paying for exclusivity and quality. Promotions
include celebrity endorsements from Jordan Dunn, Naomi Campbell, and Emma Watson.
Burberry also advertises in magazines, fashion shows, red carpets and through their
innovative technology and social media. Burberry is an international brand with loyal
customers and it is available everywhere. They have brick and mortar stores in every region.
The Burberry company is highly focused on globalization. The website allows for

international customers to navigate easily through the site. Burberry strives to ship products
directly from the manufacturer to the customer. Burberry's revenue and value was 2,329.8
euros in 2014. The product form is retailers with competitors. such as Sak's Fifth Avenue,
Nordstrom, Bloomingdales. The product category is trench coats with competitors such as
Ralph Lauren, and Lanvin. The generic version would be jackets that are in style and on
trend. The budget for outerwear clothing would be $500 to $7,000 for single breasted trench
coats. Burberry's objective is to create the image of accessible luxury. As a global luxury
brand, product excellence craftsmanship, innovation, design, remains central to the
business.
Burberry customers are millennials with disposable income who are brand loyal. They prefer
luxury brands and make other fashion statements with bags, shoes, and other accessories.
They use the trench coat as a fashion trend and also factor in climate factors. They buy all
year round and usually make a couple major hauls a year to keep up with fashion trends.
They choose their trenches based on the fashion trends of the season. They prefer Burberry
because it is a well made custom garment that will last for a lifetime. Burberry customers
respond to marketing programs by using social media and following the trends based on
Burberry's active media. Burberry is targeted towards the fashion forward higher class with
one thing in mind, which is functional luxury. They will buy again and continue to buy
because they are brand loyal customers. Burberry has the potential to continue to grow in
their market. They are already at the top and are continuing to be there, especially with their
recent showing at Fashion Week. We believe that Burberry will take a new modern look to
their trench coats for the upcoming season. However, they will still keep their classic edge.
Also, they will possibly create a darker palette within their more luxurious Prorsum line. We
predict that Burberry will be coming up with new social media market campaigns in the
future. The Burberry Kiss campaign was a huge success and as a company they have the

potential to be even more successful in the future through this endeavor. Digital and social
media is key when targeting the millennial audience.
Objectives
On the Burberry website corporate explains that they want to promote long term
success, this is not just a few years type of company. This is one that is in for the long haul
and not just trying to make a few million in a couple years and then begin its decline in the
market. Top management strives towards the objective of keeping in business for an
extremely long time and they have already done that for a few decades currently. Along with
wanting to stay strong in the market over a long period of time Burberrys corporate
representatives say that top management is also very concerned about the shareholders of the
company. They really want to please the shareholders and corporate believes that is more
easily achieved through the strong presence in the market for an extended period of time.
Through Burberry achieving their first goal of a lasting presence and brand they can then
increase the whole benefit to their shareholders.
When it comes to the product objectives category for Burberrys trench coats it is
relatively apparent what they are trying to accomplish with such a wide variety to choose
from. Although Burberry has a decent foothold in the amount of market control they have,
growth in sales is quite more apparent. With the amount that Burberry grew within the last
two years and also the steady growth within the last several years it is obvious that they wish
to focus on growing their sales.
Growing their sales has been steady and quite large at times within the past few years
in all divisions. Burberry increased their revenues by 17% from 2013 to 2014 and has gotten
close to doubling it since 2010. The total revenues has gone from 1.27 billion to 2.33 billion
in only 5 years which is pretty tremendous to say the least. Their marketing objectives seem

to be in the right place with the focus on increasing growth in sales and really all areas. The
marketing mix for Burberry we came up with involves their enormous trench coat line that
ranges from $600-$6,000 and several different styles. The place for their brick and mortar
stores is mainly in large metropolitan cities that have high traffic of people. However their
online presence is quite strong as well as selling coats in their stores they also can be ordered
and shipped to almost anywhere via their online store. Burberrys promotion has really taken
advantage of online features and social media sites in order to boost their brand even more.
Burberry has proven that they continue to grow on almost all their fronts with proven tactics
and will continue to take advantage of whatever possible to remain a major competitor.
Product and Brand Strategy
Burberry is extremely skilled in properly targeting their customers; they know their
consumers very well and cater to them through their marketing strategies. They target their
customers through ad campaigns and social media. Social media is one of the easiest and
biggest ways to attract customers these days and Burberry recognizes this. Using social
media especially targets their younger demographic, which are Millennials. Burberry also is
extremely good at giving their consumers an integrated experience, they have managed to
throughout the years, transform the brand and give consumers a better digital experience
(Davis 1). Burberrys strategy was to relaunch and innovate their brand and they indeed did
this with a whole new target market. They made sure that they had the digital and tech
savviness that would appeal to Millennials. Burberry is targeted towards the fashion forward
higher class with one common theme, functional luxury. A Burberry customer appreciates the
finer things and only wants the best of the best, and Burberry is exceptional at providing
them with this. Burberry has competitors but none of them seem to be on the same level as
them. Some of their competitors include: Michael Kors, Valentino, Ralph Lauren, Lanvin and

London Fog. Their competitors target middle class individuals who are more interested in a
stereotypical trench but wouldn't want to pay thousands of dollars. A trench coat is a basic
and a classic; it is a timeless piece that can last a lifetime. However, some people may not
have the budget or desire to splurge on a Burberry trench coat, which is where their
competitors come in. It may not be as the same extraordinary quality as a Burberry trench but
it gets the job done. Burberrys products and features are top of the line and of the finest
quality. Some of their features include: waterproof gabardine, signature check patterns,
leather buckles, and double-breasted lapels. The cotton gabardine weave is something unique
to the Burberry brand. It was a technique formulated by Thomas Burberry, it insures that their
fabric lasts through wear and tear; this is what makes Burberry such a special and excellent
brand. Their quality is unmatched by any competitor (Burberry). Their signature check print
is how most people identify the brand; you see that print and immediately associate it with
the brand. Burberrys core strategy is as a global luxury brand to produce excellence,
craftsmanship, innovation, design and that it remains central to the business. Burberry
recently went through a total revamping of their business several years ago that have tripled
their sales in the past five years (Davis 1). They want to continue this success and grow; they
want to continue to be at the forefront of the fashion industry as well as the business and
technology industry. With this core strategy they can continue to do this. Burberry offers the
customer authenticity and quintessentially British charm, which grants the brand a stand out
position in the modern luxury marketplace. Even though the brand has grown and developed,
they have always stayed true to their British roots. They have remained elegant while
becoming such a modern brand, which is not an easy task. Burberry has positioned its brand
in the minds of consumers to be functional luxury. Burberry maintains a product line with
great width and depth consisting of many products. Their products fall into one of two main
categories: fashion or continuity.

Supporting Marketing Programs

Burberry advertises their products in many places including their many social media
platforms, commercials and ad campaigns in magazines. Ad campaigns are one of the most
effective ways to gain exposure for fashion brands. They often get two to three page spreads
in magazines, such as, Vogue or Harpers Bazaar. They use different social media platforms
such as Twitter, Facebook and Instagram as well as print and TV media. There are two times
of the year that are especially important for fashion brands and those months are February
and September. These are when spring and fall fashion weeks are held. Brands will advertise
collections all here but this is when it is most important because they are releasing their
biggest collections. This is when they get the most exposure and recognition. Consumers and
the media wait for these two months just to see what brands like Burberry have to offer.
Burberry is constantly integrating their advertising within their brick and mortar and online
stores. They make sure all of their channels are cohesive. Burberry puts a lot of time and
focus into perfecting their advertising strategies. They make sure to keep things young and
fresh to appeal to their millennial market, however they want to remain classic and elegant to
still catch the eye of their older demographic and loyal customers. Their advertising,
integrates music, art, and design to not only create a mood, but to strategically position the
brand for both high-end and ready-to-wear clientele (Tso 1). Burberry has released two note
worthy campaigns recently, one featured up and coming British music artists, called Burberry
Acoustic. The campaign integrates custom music videos and exclusive interviews from each
of these music groups and arranges them in a tiled layout on the Burberry website (Tso 1).
This ad is a perfect example of how Burberry makes their advertisements unique. Another
campaign called Art of the Trench combines user-generated content to help document and
capture the lifecycle of a Burberry trench coat around the world. People around the globe are

encouraged to take a photo of themselves wearing a trench and upload it to the website (Tso
1). People visiting the site were able to view it and encouraged to comment on the photos.
This gives the brand a personal appeal by integrating its customers directly into a campaign.
Burberry is constantly having famous actors, actresses and models promote their
brand. They have had actresses like Emma Watson appear in ads in promotions and most
recently models such as Naomi Campbell, Kate Moss, Jourdan Dunn and Cara Delevingne.
These celebrities not only appear in promotions but also endorse the brand; they do red
carpet events and appear in Burberry clothing. Burberrys sales are constantly increasing;
they made 2.3 billion dollars in revenue in 2014 alone. They have grown as a market
especially in global sales in countries such as Asia. Their profits have increased by 17% from
2013 to 2014. Burberry is a top of the line luxury brand and their prices reflect this. It is an
exclusive and expensive price. Burberry trench coats range from about $600 dollars to
$6,000. Burberry has the London, Brit and Prorsum, which are different labels within the
brand ranging from least expensive to most. Burberry works through mostly two market
channels, which is digital, online sales, and then in their brick and mortar stores. They make
sure that their channels are very cohesive and work together as one to give their customers
the best shopping experience possibly. Their website is very user friendly and has the top of
the line technology, you can see how much Burberry cares about digital just by browsing on
their website. These days, with things being so fast paced and online sales increasingly
growing, Burberry has made sure that their website properly represents their brand. Burberry
has had partnerships with many brands. They have partnered with Apple in the past to
showcase a fashion show directly on the iPhone 5s (Shea 1). The Burberry Foundation also
has a host of partnerships as well. Developing their brand and making it accessible to their
entire consumer market through partnerships is something Burberry takes seriously.

Financials
Year Ended 31 March

2014

2013

2012

2011

2010

2329.8

1998.7

1857.2

1501.3

1185.1

445.4

345.8

376.9

302.1

216.5

0.7

-0.3

-10.9

-6.4

-5.1

Profit Before Tax

444.4

350.7

366.0

295.7

211.4

Profit After Tax

332.3

259.2

265.4

212.5

152.6

Stocks

419.8

351.0

311.1

247.9

166.9

millions
Turnover
Operating Profit
Net Interest

The chart above shows the profit/loss and other key features that one would want in
order to effectively evaluate a company. Burberry has shown to steadily grow in the past few
years, as mentioned a couple times earlier in this report. I would recommend investing or
being involved with this company because they seem to be doing very well and steady
growth is essential for those looking to make a good profit over a long period of time. Also as
mentioned earlier corporate/top management mentioned that they are in the business for the
shareholders and for the long term growth, so any type of financial involvement with
Burberry would result in a positive for you.

Overall Burberry is a fantastic company that has proven its worth many times over
throughout the years. Although trench coats was our main focus we believe through this
report it has been shown that Burberry is great is many different aspects including their
spectacular sales growth, the variety and strength of the brand, their expansions throughout
the years and much more. We hope this report provided a better insight into what the
Burberry brand truly stands for and what it will continue to stand for in the years to come.