Burberry and Dior: A Critical Analysis

The business environment is constantly changing. Organizations have to change to keep up with the dynamics of the new environment. Adapting to suit the new environment will not only aid the organization to maximize their profits, but also to maintain sustainability in the end. A proven way of attaining this is to plan using a strategic analysis. This report will provide an analysis of Burberry and Dior; two popular luxury fashion brands. The analysis will examine the consistency of the marketing message from both brands and compare the brands market position, heritage and brand DNA. External factors such as political, social, economic and technological factors and internal factors that affect the companies operations will also be examined. Among these factors are primary activities and support activities. The report will also examine the strategies that both brands have implemented to handle competition and to stay profitable in the market.

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Distinctive Branding at Burberry

The viability, or the lack of viability, of a fashion brand relies on the value and relevance of decisions made by management. Management is responsible for the direction the brand takes in pursuing their brand goals. Many brands have done well and others in contrast withered off due to business models that have been implemented by management. The business models that management carry out to achieve strategic or otherwise not strategic plans have a direct influence on the outcome of the prosperity of the brand. An example of a brand that experienced upheaval and prosperity following different decisions is Italian brand Gucci. In the 1950s, Gucci was a runaway success and a household luxury brand name (Phan, Thomas & Heine 2011). It was a status symbol for famous Hollywood stars and European royalty. However, a generation later, the brand began to decline in popularity and the once highly profitable brand began to make losses. The management adopted a business strategy that sacrificed management control over product development and distribution in favor of seemingly indiscriminate licensing agreements. These decisions by management dented the credibility of Gucci as an elite and aspirational fashion brand (Jackson & Haird 2003).

Burberry Brand Heritage

At the age of 21, Thomas Burberry was an apprentice to the country drape when he made the decision to branch out and opened his own store. Subsequently, Burberry was founded in 1856, in Basingstoke, Hampshire, England. Burberry did well and by 1870, Burberry was famous for its outdoor wear. Burberry was an innovative designer and in 1879 invented gabardine. Using an innovative press that waterproofed the yarn before weaving, Burberry made a breathable fabric that was named gabardine. He took a patent for gabardine in 1888. Originally, the store was known as Burberry but switched to Burberrys after a significant number of customers globally began to identify it as Burberrys of London.

In 2011, Burberry was one of the top brands in the Interbrand ranking of global brands giving it the label of a success story. The report was in commendation of Burberry's "impressive digital innovation" and capability to stay ahead of trends, even set them, and maintain a persistent and positive presence in the media". "While luxury brands performed well across the board, Burberry bested them all by focusing on its core competencies in fashion, digital innovation and global expansion," the report said. To understand the reason behind Burberrys increasing penetration, it is important to have a background of the fashion house. As discussed earlier, Burberry was founded by Thomas Burberry in 1856 at the age of 21. The second half of the 19th century enabled Burberry to build its brand name. The legacy was established and further developed in the course of the 20th century. From Burberry came the trench coat developed in First World War. The iconic Burberry check was introduced in the 1920s. Presently, the Burberry brand has a global presence and recognition as a luxury house.

Over the years, the performance of the British fashion brand Burberry has been determined mainly by the embracing of business models that on occasion, have been disadvantageous to the companys performance (Cowe 1998). Case in point in the financial year ending 31 March 1998, annual profits for Burberry dipped from 62m to 25m. At the time, financial analysts were of the opinion that Burberry was an outdated business with a fashion distinction of practically zero (Finch & May 1998). In 1997, Rose Marie Bravo, the newly appointed executive instigate changes in the company that started a turnaround. Following the changes by Rose Marie Bravo, Burberry over the years has radically re-aligned its business model and has reveled in, as a result, noteworthy developments in its business performance (Menkes 2002).

Burberry Brand Management

As has been previously recognized, the Burberry brand trademark was a vital business asset for the firm. The brand trademark held the key to aspects such as product awareness in the target population. Subsequently, the management team recognized the significance of an effective and efficient brand management plan. The first step was to update the image of the brand by to begin with, changing the name from Burberrys to Burberry. The significance of this change was supported with the introduction of a new logo for the brand and modern packaging.

The new management also recognized the important role that advertising has in the progression of international fashion brand positioning. A radically different advertising strategy was launched by Burberry. The new advertising strategy sought to shift customer perceptions of Burberry through the engagement of leading models such as Kate Moss (Phan, Thomas & Heine 2011). Leading and reputable fashion photographers were also engaged in the advertising campaign. Together with their contemporary change, Burberry maintained uniquely British themes as the main idea in the advertisements. The effort to position Burberry as a relevant and modern and at the same time credible high fashion brand needed an action that put it on the same level as other leading brands. A new flagship store was opened in London on New Bond Street. New Bond Street was a critical choice since the new Burberry store was next to other leading fashion and luxury brands dominating London. Brands that had stores in the same street include Gucci, Versace, YSL, Prada, Chanel, Bulgari and Asprey. Not only did the flagship store place it strategically next to other leading brands, but also it also acted as a vital mechanism in attracting the attention of international fashion press and it assisted Burberry obtain more editorial and other coverage from the media.

Burberry Brand Positioning

For Burberry, Functional Luxury has been the positioning they have taken in the minds of consumers. The product line that Burberry maintains has great width and depth comprising of many different products. For all their products, they can either be categorized in one of two categories: fashion or continuity. Fashion oriented products are developed in response to fashion trends and are introduced on a collection-by-collection basis. Products under continuity are expected to last for a number of years since they have life cycles. The many products by Burberry are also divided into three primary collections: womenswear, menswear, and accessories. With their depth in products from their line and the different collections coupled with fashion versus continuity, the product mix of Burberry is diverse and appealing. Subsequently, this contributes to their positioning as a brand. For their efforts, Burberry has been the recipient of many awards such as for the Contemporary Design Collection of the Year and the Classic Design Collection of the Year. The accolades are evidence of the diversity of the Burberry brand.

Subsequently, based on their diversity, the market positioning for Burberry has a wide range. Burberry has products that can appeal to the hip 25-year-old man and others that attract the conservative 65-year-old man. Despite the wide scope in age group and gender, most of Burberrys ads feature younger models. In the recent past, the ads by Burberry have featured many things from a British backdrop with noble looking models to edger ads with models wearing bikinis. Considering all this, Burberry seems to aim at attracting many different segments of the population with the common theme being functional luxury.

Dior: Origins of a Brand

In 1946, the House of Dior was founded on December 16 at 30 Avenue Montaigne in Paris. However, the present house of Dior celebrates 1947 as the establishing year (Wilcox 2007). Christian Dior, founder of the House of Dior, was born and raised on the Normandy coast of France. He moved with his family to Paris shortly after. From a young age, Dior showed a passion for drawing and he sold sketches outside of his home for 10 cents. The first true serious business venture Dior took part in was a small art gallery in Paris that his family funded. However, the family business did not do well and following its failure, Dior was forced to shut down the art gallery and started to sell his fashion sketches to design houses within France. In the course of his sales, he was employed and worked in various couture houses during the course of the early 40s until 1946. In 1946, fabric magnate Marcel Boussac financed the maiden establishment of Diors fashion house (Wilcox 2007).

After its establishment, the House of Dior launched its first spring/summer collection in 1947 at their headquarter salon. Initially, it was known as Corolle, but it was renamed New Look by Harpers Bazaars editor-in-chief Carmel Snow. The New Look line collection was influential to many designers. It was revolutionary to an extent it influenced other designers to develop and innovate and dominated the fashion industry or many years. 1947 also witnessed the founding of Christian Dior perfumes that saw the first Dior perfume, Miss Dior, launched. Pierre Cardin was in charge of the Dior workshop until 1950.

Brand Management at Dior

Following the sudden passing away of Dior in 1957, Yves Saint Laurent was made head designer of Dior until 1960. John Galliano, a former designer for Givenchy, was made head of design. Galliano is believed to have continued a style very similar to that of Diors new style in the 40s. Galliano made feminine pieces and considers in luxury and freedom as a principle of design.

Distinctive Branding and Brand Positioning at Dior

The Dior logo is a simple design originating from the name of the founder and fashion designer Christian Dior. A Nicolas Cochin font is used to create a simple word mark with the brand name. the logo is easily remembered making it distinctive. A simple logo for the internationally renowned fashion house makes it easily identified by consumers. The logo is linked to luxury, glamour, prestige, sophistication and uniqueness. It also stands for the personality of the creator of the brand.

In its years of operation, the company has operated along the values that were promoted by Christian Dior. For instance, Dior was mainly a female brand. Following the Second World War, the designer looked to liberate women from the horrors of the war by designing elegant clothes with new design that would promote joy and lightness (Jung & Ko 2009). Despite the initial focus on women, the management sighted opportunities in the market and extended their product range into products for men under the brand of Dior Homme, and for children under the brand of Baby Dior. The diversification was characterized by continuation of the similar tendency of perfectionism. The key elements of Diors person...