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Joules and Burberry buck retail woes with focus on ‘total retail’ and ‘brand heat’ across channels

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While many retailers had a woeful Christmas, some brands have bucked the trend, with niche brands Joules and Burberry both seeing better than average results across the year, thanks to a focus on seamless omni-channel ‘total retail’ and the drive for ’brand heat’ from key taste-makers and social influencers.

Both retailers show that there is a sweet-spot of store-web-mobile that can deliver, even in trying times.

Joules wins with total retail

Awarding winning and IRUK Top150 fashion retailer Joules is bucking the trend for below-expected performance logging a 14.7% increase in profit before tax (PBT) for H1 FY18, driven the company says by ‘total retail’ focus on stores, online and mobile in both the UK and internationally.

Underlying PBT increased by 14.7% to £10.7 million (H1 FY18: £9.3 million) and statutory PBT increased by 12.1% to £9.3 million (H1 FY18: £8.3 million). Group revenue increased by 17.6% to £113.1 million from £96.2 million (up 17.5% on a constant currency basis).

Joules’ retail revenue increased by 21.2% to £79.9 million, which represents growth of approximately 10%. This growth was driven by the company’s continued focus on delivering an enjoyable and seamless cross-channel experience to customers, irrespective of how, when and where they want to shop the Joules brand, says Colin Porter, Chief Executive.

E-commerce performed particularly well in the first half for Joules and now represents 46.5% of all retail sales (H1 FY18: 35.8%). The strong performance of the retail’s owned ecommerce channels was attributable to its growing active customer base, which helped drive increased traffic.

In addition, ongoing investment in both the customer experience and infrastructure of its digital platforms improved conversion trends. This growth was complemented by good performance on partner retailer websites too.

“The business’s success during this first half of the year is testament to the strength of our distinctive brand and the efforts of our fantastic team,” says Porter. “We continue to benefit from a well-invested and flexible ‘total retail’ model in the UK, which enables us to respond and adapt to shifting customer preferences. Internationally, the brand continues to grow very well in both the US and Germany.”

During 2019,  the brand will celebrate its 30th Birthday. “We have some very exciting celebrations planned throughout the year built around some of the special moments we have shared with our customers since the Joules story began –  when Tom started selling practical clothing with a distinctive twist on a stand at a country show in Leicestershire – back in 1989,” says Porter. “We have continued to trade well since the Period end with a good performance through the festive period and positive customer reactions to our new collections. We have an outstanding brand, good momentum and a growing customer base and we look forward to the second half of the financial year with confidence.”

Burberry relies on building brand heat

Burberry, meanwhile, in its third quarter update says it saw like-for-like sales across stores grow by 1% over the Christmas period, but where it has made substantial progress is in what it terms “building brand heat”, especially in China, where it is targeting substantial efforts, especially on mobile.

“While still in the first phase of our multi-year plan to transform and reposition Burberry, we made good progress in the quarter as we built brand heat and continued to shift consumer perceptions, while maintaining our focus on our financial and operational objectives,” says Marco Gobbetti, Chief Executive Officer.

“We used the monthly B-Series to bring limited-edition products designed by Riccardo to consumers,” he continues. “Sold predominantly through social media, these collections resonated strongly with new and younger customers and were endorsed by key influencers around the world. In China, the B Series was recognised as 2018’s most exciting luxury campaign on WeChat.”

This year, the retailer’s festive campaign celebrated Christmas traditions and rituals and centred around a film entitled ‘Close Your Eyes and Think of Christmas,’ featuring an all-star cast including Kristin Scott Thomas, MIA and Matt Smith.

“The response was strong with associated social conversation reaching around 57 million consumers,” says Gobbetti. “More widely, our social media presence continues to grow with more than one million additional followers QoQ across Instagram and WeChat and a more than 50% improvement in reach on WeChat.”

How well all this worked is yet to be seen. Preliminary Results for the 52 weeks to 30 March 2019 will be announced on 16 May 2019

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