When I became CEO of Burberry, in July 2006, luxury was one of the fastest-growing sectors in the world. With its rich history, centred on trenchcoats that were recognised around the world, the Burberry brand should have had many advantages. But as I watched my top managers arrive for our first strategic planning meeting, something struck me right away: they had flown in from around the world to classic British weather, grey and damp, but not one of these more than 60 people was wearing a Burberry trenchcoat. If our top people weren’t buying our products, despite the great discount they could get, how could we expect customers to pay full price for them?
It was a sign of the challenges we faced. Even in a burgeoning global market, Burberry was growing at only 2% a year. The company had an excellent foundation, but it had lost its focus in the process of global expansion. In luxury, ubiquity will kill you – it means you’re not really luxury anymore. Burberry needed to develop into a great global luxury brand while competing against much larger rivals. We wanted a share of the disposable income of the world’s most elite buyers – and to win it, we’d have to fight for prime real estate in the world’s most rapidly growing consumer markets.
One ‘brand czar’
On the surface, I might have seemed an unlikely CEO for a company that was considered quintessentially British. Raised in a small town in Indiana, I was a classic Midwesterner – something the Financial Times had fun mocking when I first took the job. But I’d been fortunate enough to work with and learn from some of the most inspirational leaders in the fashion industry, from Paul Charron to Donna Karan. And I had 25 years of experience on my side.
I also clearly had one attribute that made me a good fit: I admire and respect great brands and helped build some over the years. From Apple to Starbucks, I love the consistency – knowing that anywhere in the world you can depend on having the same experience in the store or being served a latte with the same taste and in the same cup. That’s great branding.
Unfortunately, Burberry didn’t have a lot of that. An experience in any given Burberry store in the world might be very different from the customer’s previous one. As part of my transition, I spent six months hitting the road to get a sense of Burberry worldwide. In Hong Kong, I was introduced to a design director and her team, who proudly showed me the line they were creating for that market: polo shirts and woven shirts and everything with the famous Burberry check, but not a single coat.
Then we went to America, where I was introduced to another team that was creating outerwear, but at half the price point of that in the UK. Furthermore, the coats were being manufactured in New Jersey. So we were making classic Burberry raincoats that said “Made in the USA.” I later learned that we had outerwear licensees in Italy and Germany making trenchcoats that were even cheaper than those in the United States.