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Burberry: Global Branding Challenges and Strategies Report

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Updated: Feb 22nd, 2021

Elements of brand building factors

After the opening of the first Burberry store in 1856, the brand was positioned to target the upper and middle-class consumers. By considering customer needs at the time, such positioning yielded large success for the brand. People desired to dress like the upper class in the quest to create a sense of belonging to that class, and since the Burberry brand was a lucrative item for the upper and middle classes, it satisfied this need. This aspect evidences the role played by the quality element of a brand in building brand inventory, which helps to construct brand loyalties. Hill and Ettenson (2005, p.83) posit that brand inventory ‘helps to suggest what consumers’ current perceptions may be based on’. The association of consumers with a brand of an organisation is deeply seated in the meanings that they attach to various brand elements. From 1856 to the late 1980s, Burberry brand was associated with the upper or middle class. As a brand element, quality was a measure of the capacity of the Burberry brand to reflect these classes’ social status.

The class was no longer an important factor for consideration in the selection of clothing and other accessories and outfits in the early 1990s among Burberry loyal consumers. This change in brand selection criteria by consumers explains the reduction of Burberry profits from £37 million in the early 1990s to £25 in 1997. At this time, Rose Marie Bravo joined Burberry in the capacity of a CEO. Her major obligation was to rebuild the brand. Since sporadic change had occurred in the manner that people choose their clothing, outfits, and other accessories, Bravo had to recreate the image of brand quality for Burberry from representation of class to a brand fitting the needs of all people irrespective of their social class status. This aspect implies that one of the brand building elements deployable by Bravo was brand repositioning through the utilisation of balance communication as another brand-building element.

Brand Repositioning

The case of dwindled profitability levels for Burberry brand in the 1990s created the necessity for Bravo to deploy the repositioning element for enhancing brand success. Saxena (2012, p.38) argues that a ‘successful brand may be rendered irrelevant if needs and circumstances of customers in the target market change’. This assertion suggests that on the emergence of new opportunities, repositioning is vital in helping to rebuild a brand to its initial base. In fact, Bravo joined the company to execute this particular task. For this purpose, she appointed Roberto Menichetti to redesign Burberry’s raincoats coupled with other traditional products so that they can meet the needs of the emerging consumers.

New designs of the products constituting Burberry brand were important in the derivation of their repositioning strategies. Re-engineered products come with new glamour and image. Bravo succeeded in eliminating the image of class in the products constituting the Burberry brand when finally the brand appeared on children’s clothing, home wares, watches, and bikinis amongst others. While Bravo executed this mission with the objective of broadening the sales base for the Burberry’s products, the move helped in repositioning the products as essential in meeting the needs of the general consumers irrespective of their economic classes.

Bravo commented on Roberto Menichetti successful work claiming that she was sure that the man would retain what is good and move the company forward. This comment meant that she was keen to retain aspects, which made Burberry brand in the traditional product lines. The adoption of repositioning strategy for rebuilding Burberry brand is even more conspicuous when Bravo brought in Christopher Bailey. He was to design products according to Bravo’s vision of heritage and classic, but young, modern, hip, and fashionable. This job role correlates with the need for the creation of products that present the brand image of Burberry differently.

Balanced communication

Although Bravo made impeccable initiatives to alter designs of Burberry products constituting the Burberry brand, driving the consumption of the products required ardent communication. This requirement ensured that consumers acquired awareness of the new face of the organisation’s brand. Saxena (2012) suggests that rebuilding brand success requires the creation of awareness and projection of the brand personality coupled with reinforcing favourable attitudes of a brand amongst consumers. This move requires well-balanced brand communication through strategies such as public relations, sponsorships, advertising, and even brand promotional campaigns among other strategies.

In the long list of brand communication strategies, Bravo selected advertising. She sought the professional expertise of Baron & Baron Advertising Agency coupled with Mario Testino, who is a celebrity photographer, to feature various celebrities in the advertising of the re-engineered Burberry brand. In the communication strategy, care was taken to ensure that the Burberry brand did not lose classical roots. Discussing the impression of the Burberry brand in the communication strategy, Bravo reflected her desired new brand image when she pointed out that Burberry ‘checked bra’ reduced the age of its consumers by 30 years. This aspect implies that consumers needed to see the rebranded brand as meeting the needs of young, fashion-oriented, and selective consumers.

Building Burberry into a global brand: challenges and solutions

One of the mechanisms that an organisation can deploy to expand its sales volumes and distribution capacity entails seeking larger markets. This concern led many well-known global brands such as coca-cola, PepsiCo, and Nescafe to dream on reaching global markets in the 1970s. In the list of strategies for expanding the distribution ability of Burberry, Bravo appreciated the role of globalising the Burberry brand in the effort to increase its equity. However, building a global brand is incredibly difficult since it requires huge investment in the positioning of an organisation’s brand image in new global markets.

Ensuring that customers are connected and maintained requires the creation of a dialogue that is sensible with the customers. Holt and Quelch (2004, p.73) hold that the ‘importance of brand in a business strategy affirms a paradigm of calculating its economic value called brand equity’. Brand equity encompasses a long-term investment that an organisation has to manage effectively. It measures an organisation’s economic value. Without effective management of the brand equity, it is practically impossible to gain optimal profitability. An organisation seeking to globalise its brand faces the problem of seeking various ways of improving its brand equity. This challenge is particularly significant for an organisation attempting to rebuild its brand equity such as Burberry. However, in new markets, where the Burberry brand has not been experienced before, it is easier to position it. No effort is required to erase historical brand image and replace it with a new image.

Even though financial challenges affect the attempts of an organisation to position its brand in the global markets, Burberry has a working solution. It has implemented its efforts to reach markets outside the US in phases such as Japan, Spain, and the United Kingdom with immense success. Similar approach can work for other markets including more penetration into Asian and African markets. The advantage of this approach is that profits obtained from the already established markets can be re-ploughed back into building the Burberry brand in new markets.

Making a decision to reach for global markets in a bid to enhance distribution of organisation’s products encompasses a business strategy for increasing sales levels of the products constituting a brand. However, even if Burberry succeeded in this end, building brand on global platforms involves shaping the perceptions and associations of the target market consumers positively. The main challenge encountered in the effort to position a brand in the global market entails ensuring that customers having first time experience with the organisation’s products perceive the products as the most favourable products in comparison to a range of similar products offered in the market. This challenge is particularly significant for Burberry. Positioning the brand in new markets means creating impressions on target consumers that Burberry presents a better brand as compared to the existing brands in the market. Hill and Ettenson (2005, p. 87) posit, ‘getting and keeping customers that are loyal to a particular brand is most useful when they are gross users of products’. Unfortunately, this aspect is not the case for a new market.

In a global market, a brand operates under rules of organisational convections, fragmented market structures, differing cultural factors, and even differing drivers of consumption motivations. These differences make the intended brand communication strategy to create different meanings, and thus disparate brand perceptions among various global market fragments. This aspect implies that whilst a particular brand positioning strategy may create brand success in one market, it may produce immense brand failure in another market. The solution to this problem entails the development of brand awareness strategies consistent with the existing cultural characteristic of the specific market. Although this solution may work for Burberry, it involves heavy expenditure on research in cultural and other aspects that collectively define a given target market. In some situations, Burberry may have to redesign some of its products to meet cultural norms of certain target markets. This aspect again involves expenditure of organisational resources in the development of new products lines.

According to Bravo, the strategy for reaching international markets is pegged on the need to increase the distribution of Burberry products. Attempting to build a global brand from this business strategy may expose Burberry to enormous challenges. Roth (2008, p.32) argues, ‘large, successful, and truly global brands are about something more than footprint and distribution–they are about a commonly understood and relevantly differentiating idea that transcends borders, cultures, and geographies’. Consequently, the ability to reach out for global markets does not imply that a brand becomes global. Global brands entail the construction of consistent and harmonious brand attributes coupled with associations in the mindsets of the global consumers. The solution to this problem entails the development of sustainable Burberry brand association with regard to quality in large enough target audience to meet the desired business growth of Burberry. Bravo needs to ensure that this move happens at a macro scale while ensuring delivery of reliable and dependable core Burberry brand’s promises coupled with remaining important and relevant to various diverse audiences.

The more an organisation targets diversified markets, the higher the problems of negative profiling of an organisation’s brand. In the endeavour to take Burberry brand to the global markets, inappropriate representations of the organisation’s brand by people anticipating to consume the products is incredibly challenging. In the existing market, where the presence of the Burberry brand is felt, there are already challenges. For instance, an observer described chav to encompass a young, white, and educated underclass obsessed with the brand and unsuitable jewellery. While an organisation expanding into the global markets focuses on the creation of obsession for its brand among the target consumers, in an effort to create long-term brand loyalties, this approach already faces challenges for Burberry.

The mechanism through which Burberry handles the above challenge also exposes it to the challenges of maintaining its product lines. For example, among the products associated with Chav include the Burberry’s baseball cap. Responding to images of baseball hooligans appearing in the media wearing their baseball caps led to the production stoppage of the product. An emerging major question is how many products Burberry will give up their production in the global markets especially by noting that people with differing tastes and preferences dominate such markets. One product facing the challenge of negative profiling in one global regional market may be popular in another market.

The above argument suggests that the solutions to handling the problem of negative profiling of some products constituting the Burberry brand entails going for markets where the products are embraced and then investing in their positioning, rather than removing them from all the global markets. The contribution of this strategy in enhancing the success of Burberry’s brand in some markets and not others is benchmarked by the case of McDonald’s, which is a popular global brand. The McDonald’s recognised that socio-cultural differences in the global markets result in negative association of some products constituting its brand. This aspect made the company to focus on distribution and positioning of its brand in China as delivering value to its customer through the provision of high quality chicken hamburgers as opposed to beef hamburgers. While beef hamburgers are celebrated in the American market, they are not preferred in the Chinese fast food market.

The brand equity for Burberry started to rise when Bravo joined the organisation, and thus one of the major problems faced by Burberry was the announcement of her departure. An organisation focusing on building a global brand should not base its brand growth and popularity on a single figure. The challenges associated with this tendency stems from the view that global customers need to base their consumption of an organisation’s products on the significance of the brand in terms of its ability to satisfy their needs. They should not view the brand as having the capacity to satisfy their needs in the context of being built by a certain brand leader. This aspect prevents loss of brand importance when such a leader leaves an organisation. The solution to this challenge entails basing brand success on an anonymous person residing within an organisation such as a given employee. Roth (2008, p.43) supports this strategy by noting that the ‘best way to deliver a consistent branded experience is to internally align an organisation around its brand driver’. The case of global success of BP forms an important benchmark for Burberry to emulate in its efforts to build a global brand. BP deployed the strategy of employee engagement in building its global brand.

Potentiality for dilution of Burberry brand by opening more stores and adding new product lines

When Bravo joined Burberry as its CEO, one of her priorities was opening more stores and increasing the brand product lines. Opening more stores was essential in enhancing distribution of the Burberry products. Increasing product line was important in ensuring that Burberry was repositioned to encompass a brand delivering value to all people, rather than people of a specific social economic class. However, these strategies can potentially dilute the Burberry brand.

New product lines can be established through product extensions and increasing the product line breadth. Roedder, Loken, and Joiner (1998, p.19) add that brand and line extensions ‘have become increasingly popular ways to leverage the equity associated with well-known and well-respected brand names’. As one of the brand growth strategies of Burberry, these two aspects are very important especially when the organisation seeks to satisfy the needs of the global consumers. However, the possibility of dilution of the Burberry through alternation of perception of what the Burberry brand means to its customers comes up. This scenario plays out especially in situations where product line extensions turns out to be inconsistent with the developed brand image or in case of failure of the extensions to meet various consumers’ utility anticipations. The strategy of opening more stores does not possess these effects, which brings Burberry products to easier consumer reach.

Through empirical investigations, evidence shows that under some conditions, extending product lines reduces feelings coupled with beliefs of consumers about an organisation’s brand flagship product. For instance, Roedder, Loken, and Joiner (1998, p.20) confirm this assertion by noting that important ‘risks of products lines extensions surface when brand name dilution accompanies dilution of firm’s flagship product carrying the brand name’. Flagship products encompass the products that customers associate with a given brand name. This aspect implies that if Burberry stops the production of traditional products defining its brand, probably the brand would lose meaning to its consumers.

Expanding the product line so that the traditional products loses meaning or attracts little attention among consumer makes the dilution effects of product line extension more pronounced. Opening more stores only brings the products building the brand name of Burberry closer to many consumers. This move gives the consumers constant variety of choices between competitors’ products and Burberry products within their local stores. Consequently, the strategy for opening more stores to enhance distribution of Burberry products is recommendable, as it also makes it easier to position the brand. The higher the number of times consumers encounter products making a brand, the easier it becomes to draw consumer awareness on the merits of consuming the products.

Although increasing the product line in terms of extensions for positively received products making brand for Burberry may amount to dilution of the brand, such dilution effects are important for the negatively received products such as the base ball cap. This observation implies that product line extensions are important where Burberry wants to discourage consumption of a certain product, which presents its brand negatively. This strategy is more important in new markets where Burberry is not guaranteed about the reception of a given product despite such a product constituting a flagship product in an alternative market. Where a given product is negatively received, the strategy for opening more stores will lead to even more reduction in the reception of the Burberry brand. The strategy brings the product closer to consumers and this repeated exposure to the product leads to the reinforcement of the negative association of the product with the Burberry brand.

Reference List

Hill, S & Ettenson, T 2005, ‘Achieving the Ideal Brand Portfolio’, Slogan Management Review, vol. 2 no. 1, pp. 85-90.

Holt, A & Quelch, T 2004, ‘How Global Brands Compete’, Harvard Business Review, vol.7 no. 3, pp. 68-75.

Roedder, D, Loken, B & Joiner, C 1998, ‘The negative impacts of extensions: can flagship products be diluted’, Journal of Marketing, vol. 62 no. 3, pp. 19-32.

Roth, H 2008, The challenge of the Global Brand: Handbook on Brand And Experience Management, Columbia Business School, New York.

Saxena, S 2012, ‘Challenges and Strategies for Global Branding’, Journal of Business and Management, vol. 4 no. 4, pp. 38-43.

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