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Rise in online sales helps boost Burberry profits

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Digital commerce sales at Burberry rose by 50% in the first half of its financial year, helping the upmarket fashion retailer to a 21% rise in sales.

The company today reported a 21% rise in revenue to £641m in the six months to September 30, and said its digital strategy had been a key reason for that growth. At the same time its reported pre-tax profits rose by 50% to £118m.

Angela Ahrendts, chief executive, said: “The continued focus on the brand, ongoing investment in our digital, IT and retail infrastructure, especially in China, and a disciplined approach to driving growth underpin our confidence in delivering long-term sustainable returns.”

Burberry has been investing in digital commerce and currently boasts three million Facebook fans, which it says is the highest number of any luxury brand. In today’s results it said more than 650,000 people viewed a livestream of a September runway show. That was also transmitted to invited audiences in 25 flagship stores through Burberry’s ‘retail theatre’ technology. The current Autumn/Winter 2010 advertising campaign is also “fully interactive”.

It said today that a global digital commerce platform was currently being tested ahead of roll-out in “the coming months”. The company currently sells in 28 countries through a mixture of stores, concessions and online retail.

Beyond digital, the company also opened 20 new stores in the first half of the year, including eight in Asia and seven in the Americas. It also bought a chain of stores in China. It said retail – including online commerce – accounted for 57% of sales in the first half of the year. Other sources of revenue are wholesale, accounting for 35% of revenues, and licensing (8%).

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