Young consumers boost Burberry sales rebound despite Xinjiang cotton boycott


Burberry’s sales in Asia Pacific rebounded in the first quarter of its fiscal year (Q1 FY22) driven by the purchase of new local and young customers in its core categories including handbags and trench coats. Sales in the region were up 27% year on year and 7% from 2019, Burberry said in its financial statements. Despite Xinjiang’s cotton line earlier this year and calls for a boycott of Burberry in mainland China, the brand has seen continued strong growth in the country as well as in South Korea. Burberry added that sales in mainland China had increased by more than 55% and in South Korea by more than 90% from pre-pandemic levels.

Xinjiang’s cotton row warmed earlier this year as Chinese buyers boycotted companies that refused to use cotton grown in Xinjiang province. Brands such as H&M, Nike and adidas have also faced criticism as they were among the few brands that have pledged not to use cotton from Xinjiang province, citing accusations of Uyghur human rights violations in the area. region. Overall, Burberry’s retail revenue for the 13 weeks leading up to June 26 increased 86% to $ 662 million, while same-store sales increased 90% from the same period last year and 1% compared to 2019.

In the last quarter, Burberry launched a dedicated handbag campaign centered around its new form of handbag, the Olympia. Starring Kendall Jenner, FKA twigs and Shygirl, Burberry said the campaign has generated excellent response from media and consumers, especially on social media where consumer engagement on its campaign posts has increased. double digits compared to its Pocket campaign. At the same time, the reach and engagement of Newsfeed posts increased by + 96% and + 58% respectively compared to the Pocket campaign on Instagram.

Digital also continued to experience excellent growth, with full-price sales more than doubling from pre-pandemic levels. Burberry said it has continued to improve product discovery, launching its handbag hub on Burberry.com. The luxury brand also showcased several pilots to further strengthen the integration between its offline and online channels, as well as a unique digital collaboration with Mythical Games for its first limited-edition digital vinyl toy for the multiplayer video game Blankos. Block Party.

At the same time, it continued to generate appointments and engage its in-store customers through activations, including a program of 70 pop-ups and leather goods pop-ins in high-visibility locations. It has also started rolling out its new store concept, with seven stores across Asia now using it. According to Burberry, the concept will transform the way customers experience the brand and the product in a uniquely British setting. Currently, Burberry operates 454 stores, concessions and franchises around the world.

CEO Marco Gobbetti, who reportedly left the company in June to lead Ferragamo in his home country of Italy, described it as “a great start to the new fiscal year”.

“We saw strong growth in our strategic categories, particularly leather goods and outerwear, and moved away from markdowns in digital and consumer stores. Despite a still difficult external environment, we are very satisfied with the progress made against our strategy. With the company firmly anchored on a path of growth and acceleration, we are confident of achieving our mid-term goals, ”he added. Shortly after news of Gobbetti’s impending departure was announced, media outlets, including CNN Philippines, said Burberry saw shares fall 10%.

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