How Burberry used a popular Chinese app to boost sales

LONDON — In a bid to reinvigorate sales in the massive Chinese market, British luxury fashion brand Burberry this year used a strategy that has paid off handsomely: ramping up advertising on China's popular WeChat social media app.

Burberry saw a 4 percent rise in overall sales in the second quarter, more than expected, thanks largely to a resurgence in mainland China, where sales had slowed in recent years.

Analysts note the company boosted spending on the WeChat app, which counts almost a billion users in China and serves as a multipurpose app combining social media and shopping services.

The company said its advertising campaign on WeChat for the launch of a new bag — the DK88, which retails for almost $2,000 — saw its customer reach triple on the app. Sales growth in the country was in the mid-single digits, above the global growth rate.

Ken Odeluga, an analyst for City Index, says that focusing so heavily on WeChat is a strategic move that competitors in luxury goods have yet to make. Some companies prefer to focus on physical stores to preserve the aura of luxury. Also, some online shopping sites have been accused of selling fakes.

Burberry has prided itself on combining digital marketing with sales, such as by allowing shoppers to immediately buy online what they see on the catwalk during a fashion show.

The company said that the WeChat advertising was only part of its overall sales strategy, which included new physical stores.

"The company says they are seeing 'top customers returning' to their stores," said Steve Clayton, fund manager at HL Select UK Growth Shares. "In other words, the Chinese are spending again."

Investors welcomed the results, sending Burberry's share price up 2 percent to 16.11 pounds.

In Europe, Britain led the trend of steady sales growth while demand in the Americas declined, partially due to the brand's reduction of discounted products — an attempt to boost the image of Burberry as a luxury good.

"Burberry is attempting to recapture the magical quality which luxury purveyors strive for — which is brand value," said Odeluga.

Related News

United CEO issues apology, calls removal 'truly horrific'

Apr 12, 2017

The CEO of United Airlines' parent company has issued another apology for the way a passenger was dragged off a full fight in Chicago

Texas school official removed over book's supremacist symbol

Aug 15, 2017

A Texas school district has removed an assistant principal from his post after he authored a children's book whose central character is a white nationalist symbol

Washington's top lawyer uses strategic streak to fight Trump

Feb 12, 2017

Observers say strategic thinking is a hallmark of Washington state Attorney General Bob Ferguson, who took on President Donald Trump's travel ban

You may also like these

United CEO issues apology, calls removal 'truly horrific'

Apr 12, 2017

The CEO of United Airlines' parent company has issued another apology for the way a passenger was dragged off a full fight in Chicago

Texas school official removed over book's supremacist symbol

Aug 15, 2017

A Texas school district has removed an assistant principal from his post after he authored a children's book whose central character is a white nationalist symbol

Washington's top lawyer uses strategic streak to fight Trump

Feb 12, 2017

Observers say strategic thinking is a hallmark of Washington state Attorney General Bob Ferguson, who took on President Donald Trump's travel ban

Gempak Media delivers the most talked and gempak stories on the Internet to you. Be the first to know about the latest news and don’t forget to share it around.

Contact us: sales@gempakmedia.com

Animation & Comics Award Shows Celebrity Books & Literature Fashion Shows Movies Music Performing Arts Fashion Design Entertaining Occasions Shopping Travel Press