BURBERRY’S ASIAN STRATEGY

Byline: Kavita Daswani

HONG KONG — Come September, Burberry expects it will have held its first major fashion event in Asia — a glorious outdoor fashion show and party here, most likely in a venue that conveys a strong sense of the city’s colonial past.
The show will also celebrate the consolidation of Burberry in the Far East, and the presentation of a new image to what is arguably one of the label’s biggest international markets.
So far, Burberry stores in Asia carry mostly accessories and a few basics. But over the course of the year, the company intends to streamline its distribution channels in Asia and eventually unveil a new look for the brand.
“We’re going to consolidate into our own stores in Korea, Taiwan, China, the Philippines, Guam and Saipan,” said Ulrik Garde Due, Burberry’s managing director of international sales, on a recent visit here.
The company now has well over 100 points of sale throughout the region. This year, Burberry will open a 4,000-square-foot store in Shanghai’s new Times Square, a luxurious retail center. And there are plans to open a flagship here and stores in other parts of the region.
“There are so many points of sale in Asia that our priority now is to pick one or two locations and focus on those to have ready when we want to relaunch our image here,” said Sandra Hu, Burberry’s general manager for Asia.
The big push, said Burberry executives, will be for the fall-winter 2000 collections, which will for the first time be “very fashion forward in this market.”
The new look of Burberry in Asia will reflect the brand’s international direction: The company is opening a three-story, 15,000-square-foot store in London this September, designed by New York architect Randy Ridless. That, said Garde Due, will influence all Burberry’s other stores in the world.
“We will adapt the new image to all our existing in-store shops in Asia, as well as our duty-free locations. Within a year, we will have a global image. Whatever we do in London, we will eventually adapt to Southeast Asia. It’s already one big marketplace,” he said.
Prior to the regional recession, Asia — including Japan — generated about 60 percent of Burberry’s worldwide annual sales. With its reliance on Japanese tourists, Garde Due said business in this part of the world suffered significantly during the crisis. However, in the wake of a recovery, that figure is now back to about 50 percent.
But the economic slump taught international retail executives a valuable lesson: to broaden their base beyond Japanese tourists.
“It’s true we have to shift our business,” said Hu. “Everywhere, including Japanese duty-free outlets, we will have to change our focus and include a range that is not limited just to tourists. We need to appeal as well to local customers.”
There are now 10 Burberry shops in China, in big cities such as Shanghai and Beijing as well as second-tier retail centers such as Chengdu and Dalian. The company expects a Hong Kong flagship to be the brand’s retail anchor for Southeast Asia, and is shopping for a site. Burberry’s top-end Prorsum line, which is now available in only 65 points of sale worldwide, will be introduced here next spring.