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Digital influences 70% of Burberry buying decisions

The digital channel is becoming a “much more prominent” part of Burberry and now influences around 70% of its customers’ buying decisions, its new finance boss revealed today.

Julie Brown, who joined Burberry as chief operating and financial officer in January, explained that the luxury brand’s customers are increasingly researching items online before purchasing in store.

“On average our customers visit the website eight times and look at the product category 20 times before buying, which shows the power of the digital channel,” she said.

Partly in response to this change in behaviour, the business has decided not to increase its net retail space in the 2017/18 financial year. “Our focus now is on store productivity and refurbishing [the existing estate] rather than increasing the physical space of our stores,” said Brown.

Burberry does not split out its instore and online retail sales. 

Earlier today, Burberry reported that like-for-like sales rose by 3% for the six months to 31 March, driven by an “exceptional” performance in the UK and strong growth in accessories. However, total revenue slipped by 1% to £1.6bn, hit by a weaker performance in the US market and in beauty.

Brown said Burberry is attempting to elevate the brand in the US, by pulling away from heavy discounting. It brought its Christmas Sale to an end on 9 January this year, about 10 days earlier than in 2016.

It is also working closely with its wholesale stockists in the US to ensure the brand is “positioned appropriately”, she added.

Brown seemed largely unfazed by yesterday’s announcement of a snap general election in the UK on 8 June.

“It’s very early days,” she said. “The UK is one of the stronger economies globally, as well as in Europe. We’re seeing growth in demand in the UK from both tourists and domestic [customers].”

However, she said instability was a “concern for any global business”.

“Part of our concern is around what the tariffs will be on exports from the UK. Our trench coats are made in the UK; it’s very important to us.”

Brown revealed that she sits on a business advisory committee to the Treasury, and explained: “We’re looking to try and get trade deals, rather than WTO [World Trade Organisation rules]. That is something we don’t want.”

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