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How Burberry is reaching customers face-to-face, on social media and virtually as it mitigates effect of China Covid-19 lockdowns

Burberry is working to reach its customers face-to-face, on social media and virtually as it looks to mitigate the effects of continuing Covid-19 lockdowns in China.

The luxury brand says its first-quarter sales have been held back by lockdowns in mainland China, but that it is seeing a recovery in Europe. It is running a series of brand campaigns to engage with customers in areas from social media to online gaming.

The update comes as Burberry today reports retail revenues of £505m in its first quarter, the 13 weeks to July 2. That’s 5% ahead of the $479m it reported a year earlier. Like-for-like sales were 1% ahead of last year, when they had risen by 90% on the same period in 2020. When mainland China was excluded, sales were 16% up on last time, and in Europe, the Middle East, India and Africa (EMEIA) they were 47% ahead.

“Our performance in the quarter continued to be impacted by lockdowns in mainland China but I was pleased to see our more localised approach drive recovery in EMEIA, where spending by local clients was above pre-pandemic levels,” says Burberry chief executive Jonathan Akeroyd.

“Our focus categories, leather goods and outerwear continued to perform well outside of mainland China and our programme of brand activations boosted customer engagement. While the current macro-economic environment creates some near-term uncertainty, we are confident we can build on our platform for growth.”

Growth in the EMEIA market came as the brand focused on reaching customers in their domestic markets, whose spending rose above pre-pandemic levels. That helped offset lower sales in Asia and, especially, to Chinese tourists, that have come as lockdowns continue in parts of China.

Engagement across channels

That customer engagement came both in person, online and virtually. Burberry launched pop-ups and branded takeovers to support its Lola handbag range, while launching a virtual collection of the handbag on Roblox. It also worked with Mythical Games to launch a second NFT (non-fungible token) range on its Blankos Block Party game. It also developed a social space, The Oasis, within the game that players can explore and meet virtually.

Its Instagram post welcoming South Korean Premier League footballer Song Heung-min as a brand ambassador saw its highest engagement yet on Instagram, at about 21% ahead of the previous peak. 

In-store, the brand’s new design concept was expanded to six stores during the quarter as part of a target of 65 new-look shops this year, on top of 45 last year.

Burberry sells online and through 220 shops, 142 concessions, 57 outlets and 38 franchise stores.

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