Bailey given Burberry Reins
After months of speculation, Burberry’s star designer Christopher Bailey was finally handed the reins of the £6.5bn company on the 30 April 2014, as Angela Ahrendts reluctantly stood down from the CEO post she has held there since 2006. Her eight years in the position at Burberry saw Ahrendts being instrumental in turning the company into a global luxury brand.
Mr Bailey, who has been with Burberry since 2001, will now fulfill a joint role within the company — that of chief creative, a position he took on in 2009, and as chief executive officer. Despite concern about the sheer amount of work this will represent for one person alone, Burberry chairman John Peace is confident that with his “vision and leadership” Bailey will more than fill Ahrendts’ shoes.
As with any move of this nature, the change could be considered destabilising for the brand. However, Mr Bailey was part of the trio, alongside Ms Ahrendts and Stacey Cartwright (former Burberry chief financial officer), that established the recovery and the exceptional growth of the company in recent years. They took the 157-year-old brand and launched it into the modern digital age, even securing it the title of “world’s most digitally competent luxury brand” in 2012 from the New York University affiliated research group LuxuryLab. The last five years have seen the company become one of the most technologically advanced fashion brands, leading the way on social media and in the online marketplace.
Many see the move to enlist Bailey as positive and are not concerned about the company’s continued success. Ledbury Research analyst Nicola Ko points out how ingrained the strategies implemented during Adhrendts’ time with the company have become, and the fact that Bailey has over 10 years of experience with the brand and knows it inside out, even apparently managing ‘half the company’ already.
Only time will tell whether Bailey can live up to such high expectations and command the same level of respect. Does he have the conviction to make the important decisions necessary to keep the company on track (and which saw pre-tax profits rise a staggering 27% for 2013)? However, the future looks bright.
The Future for Burberry
So what is next for Burberry? Bailey has wasted no time in announcing his latest project, which is a major push and brand remodel in Japan. He hopes to quadruple revenues within the second-largest luxury goods market worldwide. If successful, he will surely see his mark stamped firmly upon the company. Will the Japanese need some convincing? Perhaps so, but projections suggest that by adding a number of free-standing stores to the current four and introducing more concessions within department stores, revenues could reach over £100 million, which would mean £25 million of extra profit by 2017.