Burberry Mainland Sales Grew Strongly In The First Quarter, 15% Tisci.

London - a big brand replacement designer has never been an easy decision, because changes in the direction of creativity will greatly affect product sales. In this era, creative director KPI will be more linked to financial figures.

Riccardo Tisci can breathe a sigh of relief. In the quarterly report of the 2019 fiscal year just released by Burberry, his design was first included in the sales analysis. By the end of the first quarter, the proportion of new products it had charged in the main store product supply had increased to about 50%, and the results were quite gratifying. Compared with the same period last year, sales in the first quarter increased by 4%, exceeding analysts' expectations. Growth is mainly driven by new products, which means that Tisci has succeeded in leading the brand transformation. In 16 weeks, total sales climbed to 498 million.

This is the second year of Burberry's British luxury brand transformation plan. Under the innovative reform of Tisci, it has embarked on the most fashionable street style and luxury style. Tisci innovated the logo and vision of the brand, designed the new Logo represented by "TB" and applied it widely in its different products. He also expanded the series of leather goods and handbags (launched Grace, Foster and other products), and brought more frequent "new" products, like street brands. Brand men's wear and women's wear sales have double digit growth, while accessories sales have declined, but the growth of new products has offset the smooth performance of the original series. Brand says: it's too early to build a full range of products.

"When we started our multi-year transformation tour, Burberry hit a record in the first quarter. We have added product lines designed by Riccardo Tisci, and continue to transform consumer awareness of Burberry brand and adjust our retail network around our new vision. The consumer response is very positive, and the sales volume of the new series has been growing strongly. We are developing the group's plans smoothly, and our performance outlook for the 2020 fiscal year remains unchanged, "said Marco Gobbetti, the brand's chief executive.

In every market, the most outstanding contribution is the Chinese mainland market. "As far as regional development is concerned, our growth is driven by China in the current quarter," said Julie Brown, chief financial officer of Burberry, in a conference call with BoF and other media. In the context of low single digit growth in the European, Middle East, India and African markets and the US market, mainland China's sales grew by about 15%, driven by a high single digit growth in the Asia Pacific region. Brown also pointed out that Chinese tourists have shown a positive trend in shopping in the UK and said: "in terms of trade wars, it has no impact on our business."

"Our Monogram alphabet series is also very successful, especially for the millennial generation of China," Brown said, pointing out that Chinese consumers prefer "B series" products. For luxury brands, how to use Logo and Monogram may be a minefield. The abuse of brand logo may damage the brand image, and Burberry herself has suffered from it. But today, street style fashion has transformed this style into an effective measure to increase the premium of high profit products, making it easy for brands to gain in the short term.

In a previous interview with Bloomberg, Farfetch's senior women's wear editor, Celenie Seidel, said: "consumers like brands that start to brand logo as design features and incorporate them into printing." Burberry is one of the brands that use the logo skillfully and humorously. Young Chinese consumers who are more open minded are obviously more accepting.

"We believe that Asia is a key growth opportunity. Tmall and other digital platforms have been very strong, and social media such as WeChat have also been successful, "Brown told BoF. The brand has successfully launched a limited edition in Asia's social media such as WeChat, Kakao, Line and other platforms, referring to the double-digit growth of WeChat users. She described WeChat as the "main channel" of China's online influence.

In terms of physical retail, by the end of the quarter, 23 stores were redecorated, bringing in a new vision of Tisci. 9 of the 38 small, non strategic stores previously announced were closed. The brand will continue to rationalize the business space of the non luxury stores in the US.

Regarding Britain's departure from Europe, Brown said they are preparing for all possible situations, including the preparation of no agreement to depart from Europe, which may mean that the brand may increase additional taxes and fees. At present, Burberry already has a cross functional team to prepare for the supply chain in October 31st.

After the release of the earnings report, the share price of Burberry and the London Stock Exchange rose 14.39% to 22.77, the biggest gain in 7 years.

"A two pronged strategy: towards luxury and fashion," Brown summed up the success of the new Burberry.