Marketing Communication Plan

for Luxury Womenswear collection from Burberry Prorsum Line for autumn/winter 2014 – „The Bloomsbury Girls”

Yevstakhiy Biletskyy, Simona Barbarossa, Jeanne Andreani, Hung Lung-Huang, Elena

Korableva

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Executive summary The following plan outlines the marketing strategy and tactics for the promotion of Luxury Womenswear collection from Burberry Prorsum Line for autumn/winter 2014 – “The Bloomsbury Girls”. Burberry maintains a broad appeal across dual gender audience of ages 20s to 50s, with high spending levels. Burberry Prorsum, being the most expensive out of the four Burberry brands, is a style conscious brand for people who value being fashion forward. Burberry has high brand recognition, strong digital brand presence, and good distribution network. However, it also has its weaknesses, such as limited target market, low vertical integration and problems with Asian wholesalers selling products to unauthorized distributors. At the moment, Burberry sees a wide range of opportunities for retail network expansion in e-commerce and new emerging markets, as well as multiple opportunities for sponsorship and celebrity endorsements. Furthermore, the social media environment provides the brand with necessary tools for the development of customer relationships. As for the threats, Burberry faces growing competition and counterfeiting, in addition to customers’ high bargaining power and low switching costs. Burberry’s target markets constitute four main regions: Asia Pacific, Europe, Americas, and the rest of the world. Asia Pacific market alone accounts for 13% of underlying growth and retail in this region accounts for nearly 90% of revenue. Thus, most part of the Bloomsbury collection campaign budget is allocated to Asia Pacific market. It would be mainly launched in the retail stores, as with 90% of revenue representing the most important channel of distribution. Our marketing campaign is designed to inform consumers about the new collection. It pursues the goal of delivering long-lived brand values, emphasizing Bloomsbury’s philosophy and sophisticated lifestyle. We seek to create long term brand awareness, leading to purchase desire among the target group. Given the great performance of last year, we expect to increase sales by 8%. Prorsum represents about half of women mainline retail

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sales. Our most attractive channel is retail. Therefore our aim is to increase retail revenues by 5% and wholesale revenues by 1%. Additionally, the campaign pursues the goal of educating prospective customers of the younger generation in digital media with a particular attention to the Asia Pacific market. Our integrated marketing campaign with the total budget of 750 k Euro will consist of 4 stages: communication audit, communication plan (with the following adjustment of the campaign to the results of the communication audit), creative concept, and lastly, implementation and development stage. The campaign will employ IMC elements such as

celebrity endorsement, photo and video campaigns, sponsorship and product placement, direct marketing, digital marketing and social responsibility. Later, we will evaluate the campaign to determine whether it has accomplished its objectives. We will conduct surveys, focus groups, and recall and association tests, in addition to collecting data to see if purchases went up or down. Effectiveness of the Advertising campaigning will be evaluated through the separate assessment of each of the IMC elements. Brand Burberry is a world-renowned brand with a distinctive British heritage, trusted for its quality in both design and fabric, and is seen as one of the most luxurious and creative brands. It is globally recognized by the iconic trench coat, trademark check, and Prorsum horse logo. The brand occupies the niche between cutting edge fashion and classic fashion and is a symbol of both luxury and durability. This unique positioning has been consistent throughout the life of the Burberry brand and is a main driver in propelling Burberry into its current market position. Established in Basingstoke, Hampshire, in 1856 by Thomas Burberry as a family business, today the company has 9000 employees and in 2012 they had £1,857.2 million revenue.

Burberry offers womenswear, menswear, childrenswear, accessories, footwear and licensing. Womenswear is the largest department of the brand by 36%. With almost 500 stores, Burberry operates under 4 different brands: Burberry Prorsum, Burberry London and Burberry Brit and Burberry Sport.

Burberry Prorsum (Latin for “forward”) is the base line for the other Burberry brands. These couture line collections are usually something expected to be seen on a runway rather than on a street. Burberry Prorsum is the most expensive out of the four Burberry brands; it enjoys exclusive distribution and prestige pricing. Prorsum targets upper class segment.

Burberry London is somewhat of a bridge line between Prorsum and Brit. The prices and quality are between Prorsum and Brit. London is a dressed up line,

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stylish and poised. It is more conservative than Prorsum – clothes from the London collections can be easily worn to work. It appeals to middle and upper class consumers who appreciate the British clean, smart and timeless classic style.

Burberry Brit is the most accessible of the Burberry brands, representing casual, contemporary image of the brand. Even though this line represents the base of the Burberry pyramid, its clothes are set to the same high standards as all the others. Brit clothes are casual and are suitable for everyday wear. With wide distribution and accessible pricing, this Burberry brand targets younger middle class consumer.

Burberry Sport, as the name suggests, offers sport inspired clothing.

Burberry maintains a broad appeal across dual gender audience of ages 20s to 50s, with high spending levels. All the Burberry brands stick by its British identity, promising its customers the authentic English style, through clean and smart designs, with checked prints being a well-recognized symbol of the brand. The Burberry trademark gives consumers the assurance of consistency in the quality and durability of the delivered products.

Burberry’s brand image is synonymous with quality, style and elegance. It exudes sophistication and elegance and at the same time maintains modern edginess and British sensibility.

General Target Audience: 25-35 years old professionals, fashion conscious, with high disposable income.

Product

Luxury Womenswear collection from Burberry Prorsum Line for autumn/winter 2014 – “The Bloomsbury Girls”. The collection takes creative inspiration from the British decorative art of the Bloomsbury set and Charleston, the country home and meeting place for the writers, painters and intellectuals who formed the group.

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Burberry Prorsum is the most expensive out of the four Burberry brands. It is a more style conscious brand for people who value being fashion forward. Prorsum haute couture line enables Burberry to maintain its high fashion appeal, with regard for its heritage and vogue brand culture. Prorsum’s target audience is an upscale 20-35 year old consumer with an interest in functional couture.

Market Environment

The luxury fashion industry is very important in terms of its monetary sales volume (more than US$ 252 billion annually in 2011). The global luxury industry has seen steady growth over the past decades and it is commonly believed to be one of the most appealing and profitable industries in the world. The largest ten markets for luxury goods account for 83 percent of overall sales, and include Japan, China, United States, Russia, Germany, Italy, France, United Kingdom, Brazil, Spain, and Switzerland. In 2012, China surpassed Japan as the world's largest luxury market. Today China's luxury consumption accounts for over 25% of the global market. In 2012, Chinese customers alone accounted for 10% of Burberry’s total sales.

In past years Burberry extended its business from the Americas, Asia and Europe to Emerging Markets, such as India, Brazil and Middle East. The company believes these markets represent important components of future growth.

Competitors

Burberry has many competitors; pricing level places the brand in competition not only with luxury brands like Gucci, Coach, Chanel and Louis Vuitton, but also with lifestyle collections, such as Ralph Lauren and Calvin Klein. While brands like Coach and Gucci focus more on accessories and others focus more on the apparel market, Burberry has succeeded in penetrating both the accessory and apparel market while remaining a luxury good. The fact that Burberry has many different lines within its brand allows for more high-end goods and goods that would be feasible for purchase by the general population. Burberry’s unique positioning of functional luxury is extremely competitive and will sustain over the long-term.

Target Generation XY (25-35). Fashion concious, upper class, working youngsters, with high disposable income.

Target Market Coverage

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The target market coverage of Burberry could be divided into four parts in terms of the region, including Asia Pacific, Europe, Americas, and rest of the world.

Americas • 6% underlying growth • Retail accounted for approximately two-thirds of

revenue • Low single-digit comparable store sales growth,

weighted towards the second half • Approximately 10% of Americas retail revenue came

from outside the United States • North American department store wholesale customers

out-performed, with further expansion of dedicated shop-in-shops

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From the above report, we could find out the fact that Asia Pacific is one of the markets where growth is quite fast; especially in China, Hong Kong, and Korea, where underlying 13% of the growth. Therefore, we would allocate most of our Bloomsbury collection campaign budget in these markets. In addition, the Bloomsbury collection would mainly be launched in the retail store where we could deliver the value of the collection more elaborately. Besides, retail store also accounted for 90% of revenue. Hence it’s important for us to weighted more on the retail channel. SWOT analysis Strengths: ü Brand awareness and brand recognition: listed in Interbrand’s ‘Top 100

Global Brands’ for the fourth consecutive year; luxury fashion brand with the greatest increase in brand value.

ü Good distribution network: 206 mainline stores, 214 concessions within department stores, digital commerce and 49 outlets; department stores, multi-brand specialty accounts, Travel Retail and, franchisees who operate 65 Burberry stores mainly in emerging markets.

Europe • 6% underlying growth • Retail accounted for nearly 70% of revenue • Comparable store sales growth broadly unchanged

year-on-year; France and Germany robust, Italy remained weak

• The United Kingdom accounted for over 40% of Europe retail revenue

• Largest wholesale region, about 40% of group wholesale revenue. Revenue impacted by weak demand, especially in Italy, and continuing planned rationalisation of accounts

Asia Pacific

• 13% underlying growth • Retail accounted for nearly 90% of revenue • Double-digit comparable store sales growth in China

and Hong Kong; Korea remained weak • Good growth in Travel Retail, which makes up the

majority of wholesale in the region Rest of World

• 11% underlying growth • Retail accounted for nearly 60% of revenue • High single-digit comparable store sales growth, led by

India • Good growth in wholesale revenue, mainly to franchise

partners who operate 65 stores globally

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ü Digital leader: luxury brand with the highest digital customer awareness (Altagamma); the most followed luxury brand on Facebook, with nearly 15 million fans.

Weaknesses ü Limited target market: premium line has high prices, difficult to reach

upper class customers. ü Low vertical integration: less probability to capture margin and value. ü Asian wholesalers: sold the products to unauthorized distributors without

respect to the brand image.

Opportunities ü Retail network expansion, especially in e-commerce and new emerging

markets. ü China’s booming fashion industry: investment and growth. ü Sponsorship and celebrities endorsement. ü Social media: develop customer relationship, crowdsourcing.

Threats ü Competition: able to engage their audiences on social media and

building bigger fan bases; newer and cheaper brands offering similar products.

ü Counterfeiting. ü Customers’ high bargaining power and low switching costs.

Channel Mix Burberry sells its products to the end consumer through both retail (including digital) and wholesale channels. Recently the firm is focused on Western, Asian, and Latin American retail markets and has reduced accounts in European and North American wholesale market. As a result, in 2013 retail revenues increased by 12% and wholesale revenues only by 1%. For 2012/13, retail accounted for 71% of revenue and wholesale 24%. Prorsum represents about half of women mainline retail sales. The brand outperformed in 2013 with an increase of penetration in retail by 4%.

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14%  15%  

32%  

31%  12%  

 £-­‐        

 £400,00    

 £800,00    

 £1  200,00    

 £1  600,00    

2009   2010   2011   2012   2013  

Retail  revenues  and  growth  rate  

Retail

12% underlying growth 5% comparable store growth 7% growth from new space 23 mainline store openings, focused in flagship markets including Chicago, Hong Kong, Milan and London

Wholesale

1% underlying growth Growth in North American department stores, Asia Travel Retail and emerging markets Net eight new franchise stores opened

Licensing

1% underlying decline Royalty income from Japan down reflecting continued rationalisation of short-term accessories licences in Japan Double-digit underlying growth in royalty income from global product licences Burberry began directly operating fragrance and beauty from 1 April 2013

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Objectives (KPIs) Sales Objectives (by 31 March 2014)

• Increase revenues: +8% • Maintaining strategic position in retail: +5% • Increase wholesale revenues: +1%

Communication Objectives (long-term)

• Brand image (CSR) • Brand resonance1 (loyalty, attachment, community, digital engagement)

1 Keller’s CBBE pyramid

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Strategies & Implementation

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Strategies and implementation Major Idea Inform the audience about the new collection, delivering long-lived brand values, emphasizing Bloomsbury’s philosophy and sophisticated lifestyle. Focus on Britishness, authentic outwear heritage, democratic luxury positioning, and innovation. Create long term brand awareness, leading to purchase desire among the target group. Education of young generation prospective customers in digital media with a particular attention to the Asia Pacific market. Phases ü Phase 1 Communication Audit 8-10 weeks, January 2014 market analysis, audience research, competetive review Report: Presentation (first week of March 2014) ü Phase 2 Communication Plan 8-10 weeks, concurrent Elaboration and ongoing assessment of the plan. Adjust campaign to results of the Communication Audit Report: Presentation (first week of March 2014) ü Phase 3 Creative Concept 6 weeks, March 2014 Mood board workshop, campaign identity and vision Report: Concept map, story board for commercials, visualizations of digital marketing campaign, detailed IMC plan (middle of April 2014) ü Phase 4 Implementation & Development Ongoing Production, application, development and ongoing assessment of particular IMC tools. Monitoring and immediate response to any crisis situation. Report: Seasonal report incl. media statistics, purchase analysis, brand awareness research (February 2015). Timeline

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Link to the Interactive Timeline: http://www.timetoast.com/timelines/893040 Detailed Overview

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Budget Allocation Celebrity Endorsement, Photo and Video Campaign 20 %

Print Media (ads in Magazines) 5 % Outdoor (billboards, street screens, transition ads) 10 % Direct Marketing (coupons, direct catalog, e-catalog) 5 % Sponsorship and PR (publ. of book, VIP new year dinner, awards) 15 % Digital Marketing (SEO, online ads, ad sense, social media campaign, big data) 35 % Social Responsibility (i-Tunes revenue for charity, wereable devices) 10 %

Total: 750 k Euro

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Evaluation & Follow Up

Photo Campaign Campaign with endorsed celebrity Media: print ad, outdoor ad, direct catalog, press realease Micro regional campaigns for Christmas, Chinese New Year, Valentines Day Goals fulfilled: Promotion, Brand Reputation Video Campaign Media: short ad spot for Social Media and VOD platforms, in-store screens, story telling video for official website and social media Micro regional campaigns for Christmas, Chinese New Year, Valentines Day Goals fulfilled: Promotion, Brand Reputation Sponsorship & Product Placement Tools: Sponsorship of fashion related TV Programmes in part. Countries (eg. America’s Next Top Model), sponsorship of the limited edition of book about Bloomsbury Group, product placement in female fronted movies and TV sitcoms Goals fulfilled: positioning, brand awareness, educate young next generation of buyers, brand reoutation Digital Marketing Tools: Burberry App with innovative showrooming tool, Social Media Campaign (Facebook, Twitter, Instagram, Weibo - #tag competition), e-discount promotions, SEO, ad-sense for targeted group (buy now = get 20 % discount) Collaboration with Line and Wechat (China, HK, Singapore, Japan, Taiwan only) free collection-related stickers plus group where customers can discuss collection and ocasionally get discounts Goals fulfilled: Promotion of Collection, Engage Customers, boost sales, educate young next generation of buyers Big Data Tool: Encourage clients to download Burberry app and share their personal information in exchange for special edition of season e-catalog with discounts and promotions, membership in Burberry loyalty program Goals fulfilled: Personal Information for Direct Reach of pot. Clients, engage customers, boost sales (discounts) Social Responsibility Innovation: wearable devices (dress which scans your body and sends tips concerning your style diet etc. to your burberry app account) Charity: iTunes – runway tracks download and revenues from that for sponsorhsip young artists, musicians; Sponsorship of Art and Literature Awards around the world; sponsorship of special exhibition of bloomsbury artists in part. countries; new year charity event with celebrities and VIP raising money for young artists. Goals fulfilled: brand reputation, indirect reach of potential clients, engage customers

Burberry Autumn/Winter 2014

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We will conduct some posttests, both field and laboratory, such as recall tests, tracking studies, association tests, and focus groups. By conducting these tests, Burberry will be able to determine if the campaign accomplished the objectives of increasing brand image and brand repuation. If purchase went up or down Burberry will collect data in order to find out if purchases increased or decreased. We believe that sales will increase by 8% compared to last year’s collection. We would also maintain our strategic position in retail and increase by 5% and increase wholesale revenue by 1%. Brand awareness increase (quantitative) One of Burberry’s goal is to increase the brand awareness. Due to the IMC, we believe that the brand awareness will increase by 10%. We forecast a brand recognition of 90% and a brand recall in consumers’ evoked set of 20% in their Top-of-Mind. Brand image increase (qualitative and quantitative) Qualitative reasearch based on focus groups and in-depth interviews (unstructured and partially structured). We will use association tests like brand concept map and projective techniques. We will also use quantitative surveys to measure consumers’ evaluation of the brand and their willingness to pay. Brand resonance increase (quantitative) We will use surveys to measure consumers’ loyalty and to verify how they perceive us compared to our competitors. We will measure consumers’ engagement with a focus on digital environment (see below). Evaluate of Advertisement campaigning Endorsement Burberry will be endorsing with Paloma Faith in a campaign; taking into account how many fans Paloma Faith has, Burberry has found that they will be able to reach 1 k thousand people. Print media ads in magazines ü Inquiry tests will be used to measure the effectiveness by generating a

number of inquiries that was made from the ads appearing in the print media.

ü There are three complex ways to measure effectiveness: running the ad in successive issues of the same medium, running split-run tests where variations of the ad appear on different copies of the same medium, and

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running the same ad in different media. The first measures the cumulative effects of the campaign, the second examines specific element of the ad, and the final method measures the effectiveness of the medium rather than the ad itself. Burberry will apply these three methods in order to examine the effectiveness of print ads.

Outdoor (billboards, street screens, transition ads) ü Burberry determined that there will be a large amount of people that will

see these outdoor advertisements due to the statistics they found of over 70% of the population spend their time outside the home.

Direct marketing (coupons, direct catalogue, e-catalogue) ü Tracking studies and counting the number of coupon redemptions would

be ways to determine the effectiveness of direct marketing. Sponsorships and PR (VIP new year dinner, awards) ü Sponsorship effectiveness will be measured by the quantity and nature of

the media coverage and by estimating the direct and indirect audiences. ü Correlation between brand and sponsoring activities (-1<r<1) Digital Marketing (SEO, online ads, ad sense, social media campaign) ü Burberry is using state of the art technology in order to see how

consumers are viewing the online ads on websites. This technology tracks the eye movements of the viewers and by using the data, Burberry will be able to find the best location to place the online ads.

ü Social Responsibility (i-Tunes revenue for charity, wearable devices) Presence in Social Media (data mining strategy - explain) Data mining is a process used by companies to turn raw data into useful information. By using software to look for patterns in large batches of data, businesses can learn more about their customers and develop more effective marketing strategies as well as increase sales and decrease costs. Burberry would use the data mining strategy to gather information from social media in order to find what sort of online presence they have. An example is to track how the number of fans there are on the Facebook page and to include the number of friends that each user has. Another is by measuring how many users engage and interact with the message Burberry can evaluate the appeal and interest of the marketing efforts. The more engagement there are the more effective and valuable the campaign is. Facebook – Number of clicks the links received. Number of times the messages were commented on. Number of times the messages were liked. Twitter – Number of times the hashtag was included in tweets. Number of retweets. Number of clicks the link received. Total number of Twitter users involved in activity.

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Blog – Number of new subscribers. Amount of sharing of the posts. Amount of comments. Youtube – Amount of new subscribers. Amount and type of ratings (positive or negative) Number of comments. Burberry will also look at the share of voice they have; they will find out how often they are mentioned in social media. Brand do this by collecting data on the number of times the Burberry brand is mentioned and compare them to the number of times the competitors were mentioned. Conclusion Burberry is a world-renowned brand seen as one of the most luxurious and creative brands. Burberry has a wide range of opportunities for retail network expansion in e-commerce and new emerging markets. Therefore, we designed our marketing campaign with the objective to inform consumers about our new Luxury Womenswear collection from Burberry Prorsum Line for autumn/winter 2014 – “The Bloomsbury Girls”. We are seeking to create long term brand awareness, leading to purchase desire among our target group of Generation XY (25-40). Our integrated marketing campaign will consist of four stages: communication audit, communication plan, creative concept, and implementation and development stage. The campaign will employ IMC elements such as celebrity endorsement, photo and video campaigns, sponsorship and product placement, direct marketing, digital marketing and social responsibility. Effectiveness of the Advertising campaigning will be evaluated through the separate assessment of each of the IMC elements. Burberry’s campaign will overall accomplish the objectives of increasing brand image and brand repuation.