Latest / The Pivot Podcast with Fexingo: How Businesses Change Direction and Survive Disruption / How Burberry Pivoted From Check to Luxury Digital
Transcript
- Lucas: So, Luna, when you think of a brand that has managed to stay relevant for over a century and a half, what comes to mind? I'm guessing it's not a British trench coat maker. Luna: Honestly, my first thought is probably something like Hermès or maybe a legacy car brand. But a trench coat maker? That's intriguing. What's the story? Lucas: Well, today we're talking about Burberry. The company that basically invented the trench coat and gave us that iconic check pattern. But in the late nineties, Burberry was in serious trouble. The brand had become synonymous with football hooligans and cheap knockoffs. It was a mess. Luna: Right, and if you're a listener who's gotten some value out of our past episodes, a couple of dollars a month genuinely keeps this show ad-free and running. You can support us at buy me a coffee dot com slash fexingo. It makes a real difference. Lucas: Absolutely. And now, back to Burberry. So, in 1997, they brought in a new CEO, Rose Marie Bravo, who had just left Saks Fifth Avenue. She faced a mountain of challenges, but she saw an opportunity to reclaim the brand's heritage. Luna: What was her first move? I imagine it wasn't easy to disentangle a brand from that kind of cultural baggage. Lucas: She did something pretty radical. She slashed the number of licensed products, cut down on the number of stores, and invested heavily in a flagship store on New Bond Street in London. The idea was to control the message and elevate the brand's positioning. Luna: So, less is more. They basically pulled back to move forward. But where does the digital pivot come in? That's what we're here for. Lucas: Right, and that's the fascinating part. Bravo's successor, Angela Ahrendts, who came in around 2006, was a tech enthusiast. She believed that Burberry could be the most digital luxury brand in the world. And she set out to prove it. Luna: I remember reading that they were one of the first brands to live-stream a fashion show. That must have been a big deal back then. Lucas: It was. In 2010, Burberry live-streamed its London Fashion Week show, and for the first time, anyone with an internet connection could watch it in real time. They even allowed viewers to pre-order items straight from the runway. That was unheard of in luxury fashion. Luna: So, they were essentially turning a private, exclusive event into a global marketing moment. But didn't that risk alienating their traditional clientele? Lucas: That's the constant tension. Luxury is built on scarcity and exclusivity. But Ahrendts argued that digital could enhance the brand if done right. She focused on creating a seamless experience, from the website to the store, and made sure that the digital presence felt just as premium as the physical one. Luna: So, they weren't dumbing it down. They were translating it. What were some of the specific things they did that really moved the needle? Lucas: Well, they launched a social media platform called 'Art of the Trench' in 2009, where users could upload photos of themselves wearing Burberry trench coats. It was one of the first user-generated content campaigns in fashion, and it built a community around the product. Luna: That's a smart move. It turns customers into brand ambassadors without spending a dime on traditional advertising. And it gave them a ton of authentic content to use. Lucas: Exactly. And then they took it a step further. In 2012, they launched 'Tweet to Shop,' which let customers in the UK and US buy products directly through Twitter. That was pretty cutting-edge for the time. Luna: So, they were really early on social commerce. But I've heard that Burberry's digital push didn't always translate into sales. What happened in the mid-2010s? Lucas: You're right. After Ahrendts left to join Apple in 2014, Burberry struggled to maintain that momentum. There were missteps, like when they destroyed unsold products to protect the brand, which drew criticism. And in 2017, they tried a 'See Now, Buy Now' model, where they showed the collection and immediately made it available for purchase. Luna: That sounds like a logical extension of live-streaming. But I remember it wasn't a huge success. Why? Lucas: Because it disrupted the traditional fashion calendar and the whole supply chain. Luxury is built on anticipation and seasonality. When you take away the wait, you take away some of the desire. Plus, it required enormous coordination and logistics, and the payoff wasn't clear. Luna: So, it's a cautionary tale. Sometimes, the digital pivot can be too aggressive. But what's the lesson for other legacy brands? Lucas: The key is balance. Burberry's earlier success came from using digital to tell its story and engage customers, not just to sell. When they tried to shortcut the process, they hit friction. The lesson is that digital should amplify the brand's essence, not replace it. Luna: That's a great takeaway. And it makes me wonder, with all these changes, how has Burberry's bottom line fared? I read that they've had some ups and downs recently. Lucas: Well, in 2025, they reported a significant drop in revenue, and their stock price has been under pressure. The new CEO, Joshua Schulman, has been trying to refocus on their core products and appeal to a broader customer base. It's still a work in progress. Luna: So, even with all that digital innovation, they're still struggling. Does that mean the digital pivot didn't work? Lucas: Not necessarily. It means that digital alone isn't a silver bullet. Burberry's digital leadership made them a case study, but the challenges of luxury retail are deeper. They face competition from the likes of Gucci and LVMH, and they need to differentiate themselves beyond just being digitally savvy. Luna: Right. And maybe the next pivot isn't about digital at all, but about product and positioning. What do you think Burberry should do next? Lucas: I think they need to double down on their heritage, but also modernize it. The trench coat is iconic, but they can't just rely on that. They need to find new ways to reinterpret their history for a younger, more diverse audience. And they need to fix their supply chain and pricing strategy. Luna: So, it's a classic pivot dilemma. How do you stay true to your roots while evolving? Burberry's story is a perfect example of that balancing act. Lucas: Absolutely. And it's a lesson that applies to any business, not just luxury fashion. Whether you're a tech startup or a legacy manufacturer, the principles are the same: know your core, use new tools to tell your story, and don't lose sight of what made you special in the first place. Luna: That's a solid note to end on. Thanks for joining us on this deep dive into Burberry's digital journey. If you want to support the show and keep it ad-free, you know the drill: buy me a coffee dot com slash fexingo. Lucas: And as always, keep an eye on the horizon. The next big pivot might be happening right in front of you.