Burberry reports year of digital transition
Written by Peter Walker
Burberry’s annual profit rose 2 per cent, while revenue dipped by 1 per cent, amid a year of transition towards a more digital strategy.
Adjusted operating profit benefited from “positive” retail performance, with the cumulative total now standing at £64 million. Pre-tax profit came in at £412 million for the year, up from £394 million last year.
Retail sales rose 3 per cent to £2.18 billion in the period, which was up 2 per cent from reported rates.
Mainland China delivered high single-digit percentage growth, with Hong Kong improving through the year. The UK delivered low single-digit percentage growth, while continental Europe declined marginally.
“In a year of transition, we are pleased with our performance as we began to execute our strategy,” stated chief executive Marco Gobbetti, who took over the role from Christopher Bailey last year.
In November 2017, Burberry set out its multi-year plan to improve products, customer communication and experience – much of which is being driven by new technology investment.
The business reported progress on its retail excellence programme and the roll-out of a new digital clienteling tool, which it said has supported increased conversion. Burberry also refreshed its websites recently, with more curated content generating increased engagement.
Also, over the next two years Burberry will move from a single set platform to a combined solution for both retail and wholesale, with SAP HANA Enterprise Cloud.
Burberry also highlighted how its direct-to-consumer (D2C) offering delivered good growth, particularly in Asia. Mobile transactions represented 40 per cent of D2C revenue, while a collaboration with luxury online marketplace Farfetch has extended the brand’s reach to more customers and over 150 countries.