Burberry, the quintessential British luxury brand, is perhaps one of the most high-profile brands to have experienced a downturn in fortune during this period. The company had a pretty rough run as they watched their overall share value crash in value by 96%. Now, with new leadership at the top, it has released a turnaround blueprint. Joshua Schulmann, who appointed himself in March last year as Burberry’s chief executive, unveiled the “Burberry Forward” strategy in November. His mission is to return the brand to its former glory and financial success.
While the luxury sector is feeling the economic pressures, Burberry’s plight is particularly striking. … [T]hey are much deeper than those of its peers. Other luxury conglomerates such as LVMH and Hermès continue to weather the storm with modest results. By comparison, the volatility of Burberry’s share price has been significantly worse. By early 2023, this stock had peaked at 2,608p. By September this had dropped to a low of 557p, raising alarm bells among investors.
Just this week, Burberry moved to address these very concerns. To change that narrative, they put forth a very ambitious plan, intended to reverse the downward trend that’s hurt the brand and the overall luxury market. The impacts of this new initiative are largely unknown. The company’s woes have been well-documented and the ensuing difficulty has doused the company’s stock.
Even with a slight rebound from its September bottom, Burberry’s share price has some way to go before reaching its previous peaks. That still leaves it below February’s high of 1,254p. Evidence of progress They’re an indicator that some of the worst may be over. It’s clear that considerable challenges remain. Those rollercoaster-like highs and lows in share price show what Canoe’s rocky start reveals—its brand vulnerability in a disruptive, cutthroat luxury scene.
Burberry’s recent initiatives are starting to prove that the luxury house is serious about turning around its fortunes. The “Burberry Forward” plan looks to reverse all of this. Its goal is to increase its attractiveness to consumers and regain them. Schulmann’s leadership marks a shift towards a more aggressive approach in reestablishing Burberry’s status within the luxury sector.
As Burberry seeks to regain its footing, it faces stiff competition from brands like Hugo Boss, which have managed to navigate recent market challenges more effectively. The difference in performance begs the question whether Burberry is unfairly positioned—whether it can hope to attract interest of the kind enjoyed by other luxury brands.