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Online helps Burberry clock up 18% first quarter growth

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Burberry this week said online sales and digital investment helped to boost its sales by almost a fifth in the three months to June 30.

In a first-quarter trading statement, the upmarket fashion retailer said revenues rose by 18% to £339m over the quarter. The growth, it said, was driven by the strong performance of spring/summer 2013 fashion, and facilitated by investment in digital. “Reflecting changing consumer behaviour,” said the statement, “footfall was soft offline but grew strongly online.”

Comparable store sales, up by 13%, lagged behind the online and social media-driven overall rise in sales. Store sales grew fastest in Asia Pacific and the Americas. But growth was present, said Burberry, across products and regions, online and off. “Online performed strongly globally, benefiting from full integration into the regional infrastructure,” it said.

Significant developments during the period included the launch of Burberry Kisses, a service developed in partnership with Google that enables shoppers to capture their kiss through a smartphone and send a digital letter signed with that kiss.

However, despite the rise in revenues, Burberry said it expected first-half pre-tax profits to be lower than over the same period last year.

Chief executive Angela Ahrendts said she was pleased with the first quarter performance.

“Spring/Summer 2013 was a standout season driven by innovative marketing, cohesive monthly fashion groups and exceptional execution from all corporate and regional teams,” she said.

“Looking forward, the macro outlook remains uncertain and we will continue to focus our investment on profitable high growth opportunities by channel, region and product categories.”

Eric Abensur, group chief executive at ecommerce platform provider Venda, said: “Burberry is a brand that has a clear view of both its market and customers. Not only has the company diversified its product offering in line with consumer demand, by placing greater emphasis on its accessory and beauty range, but it has also engaged and driven sales from an increasingly influential international customer base.

“Additionally, Burberry has been unafraid to embrace technological innovations that personalise and humanise the online experience. Initiatives such as Burberry Kisses, which allow customers to send gifts sealed with their own kisses, shows how the company is proactively manoeuvring the hurdles associated with digital channels. In tough trading times, all retailers should be thinking about how they too can leverage technology to heighten their international presence in the most cost-effective way, while also improving and enhancing the consumer experience. By doing so, like Burberry, they too will see a positive impact to their bottom line.”

Burberry recently won both the Innovation Award and the overall Judges’ Award at the Internet Retailing Awards 2013. The multichannel retailer was recognised for its use of digital within its stores and beyond. The Innovation Award recognised in particular the retailer’s Regent Street flagship store where digital allows customers to explore the range through a variety of screens of all sizes within the store and through the catwalk shows held in-store.

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