This week, Burberry reported sales down 12 percent in its most recent quarter, while full-year revenues of £2.97 billion ($3.77 billion) were flat at constant exchange rates.

Shares in the company have fallen 57 percent over the past year and are now trading at their lowest level since 2016, ratcheting up pressure on Burberry chief executive Jonathan Akeroyd and creative director Daniel Lee to deliver a long-awaited turnaround.

Burberry’s woes are, in part, the product of a more difficult luxury market: inflation and slowing economic growth have taken their toll, particularly among the Chinese customers who used to power the brand’s business both domestically and in European shopping hubs.

But the company’s wounds are also self-inflicted: after building massive name recognition and a $3.8 billion per-year business in the 2000s and early 2010 — with a strategy rooted in an easy-to-digest interpretation of its British identity and a price positioning that straddled the line between top luxury houses and premium labels like Polo Ralph Lauren — Burberry has been bogged down in a decade of stagnation as its strategy to push upmarket falters.

To be sure, the downfall of US department stores and the rising cost of manufacturing high-quality products made the brand elevation strategy feel like a necessity. The brand bet that its bags and shoes goods could surely be lifted in line with the luxury clout of its flagship trenchcoats. Meanwhile, the prospect of one day being acquired by a big luxury group like LVMH or Kering offered further enticement to the top end of the market.

Efforts to elevate the Burberry brand began in the mid-2010s under Christopher Bailey (then serving as both CEO and creative director) and intensified under former CEO Marco Gobbetti and designer Riccardo Tisci from 2018 to 2022. Now on its third CEO and third designer (and third logo) in a decade, Burberry is persisting in the Sisyphean task of convincing the world to buy $2,700 Italian-made handbags from a British outerwear brand.

That’s not to mention tough sells like $1,000 khaki chinos or $1,450 cardigans. Those prices are roughly in line with wardrobe staples from European luxury houses like Celine and Loewe. But while those brands have bag businesses big enough to justify a more niche, top-end approach to ready-to-wear, Burberry is an apparel brand: selling clothing at prices clients are willing to pay is the core of its business.

The long-standing disconnect between Burberry’s strategy and its identity as a purveyor of premium outerwear is taking a toll.

“The combination of weak social media and Google search trends, as well as muted feedback from the trade on Burberry’s new collection, give no reason to believe that its momentum is accelerating,” UBS analyst Zuzanna Pusz said Tuesday in a note to clients.

There are some signs of progress. Akeroyd, a seasoned merchant from McQueen and Versace, is working to fill stores with a revamped menu of carry-over items across categories, backing up the brand’s runway vision with more accessible propositions. A new store concept is lighter and more engaging, mixing vivid colours, textures and product categories in places where the previous leadership had over-indexed on monochrome, visually static displays of the brand’s increasingly expensive handbags.

Then there’s the creative execution: Lee has managed to gradually turn up the brand’s cool factor while updating the brand’s messaging on the key topic of Britishness. Where former creative director Riccardo Tisci had focused on exploring codes and archetypes of British dress, Lee has tackled Britain and Britishness as a cultural hotbed and attitude. Shygirl and Skepta have starred in campaigns, while his “London Portraits” series shows how a diverse cast of stylish Britains can inhabit the Burberry wardrobe in modern ways.

But too many of the brand’s communication efforts under Lee have advanced a niche vision that has little to do with how typical customers see (or want to see) Burberry or Britain. And fashion fans likely to connect with Lee’s vision have other places they can splurge on $1,300 strappy sandals.

Niche fashion can provide a welcome halo effect for corporate fashion giants when the rest of the business is firing on all cylinders, but stronger counter balances are needed to keep a global business on track. Louis Vuitton, for example, has signed on for another 5 years of womenswear director Nicolas Ghesquière’s time-travelling, ür-sophisticated fashion collages.

But Ghesquière’s collections are just one plotline in the brand’s broader story. In addition to onboarding pop star and producer Pharrell Williams as menswear creative director, Vuitton recently hired Blake Harrop, a Wieden+Kennedy executive who has orchestrated campaigns for mass market giants like Nike and McDonalds, in the role of executive vice president for image and communications.

By over-indexing on top-end, niche fashion, Burberry is leaving money on the table: its singular position as Britain’s only megabrand requires a broader approach. The brand needs more accessible prices and more accessible marketing — and quick.

THE NEWS IN BRIEF

FASHION, BUSINESS AND THE ECONOMY

Canada Goose beats estimates on China strength. The Toronto-based company reported revenue of C$358 million ($263 million) for the fiscal fourth quarter. Sales grew 22 percent from a year earlier.

Swiss sneaker company On reports record quarterly revenue of $560 million. The bulk of this growth was driven by the expansion of its direct-to-consumer business. The brand’s shares were up over 14 percent in early trading Tuesday.

Anglo American explores De Beers IPO as part of break-up, say sources. The London-listed miner set out its plans for a potential break-up via a demerger or sale of some of its assets, as it fights off a $43 billion takeover bid from BHP Group. CEO Duncan Wanblad said the plan was to spin out or sell De Beers, without giving further details.

Converse cuts jobs as part of parent Nike’s cost-savings plan. Nike is undergoing a $2 billion cost-cutting plan that includes slashing 2 percent of its workforce. Layoffs have hit its Oregon headquarters across two rounds, with the process expected to conclude by the end of its fiscal year.

Roksanda sells to The Brand Group. Citing “recent volatile market conditions,” Roksanda said it had filed a notice of intent to appoint an administrator, before finding a white knight in TBG. Roksanda Ilinčić will remain at the brand as creative director.

Hugo Boss and David Beckham partner up for design collection. The collaboration includes collections designed and curated by David Beckham for both formal and casual menswear. Beckham will already appear in the brand’s global campaign in autumn this year.

Victoria’s Secret fashion show to return in late 2024. In an Instagram post, the intimates retailer said the show will “reflect who we are today, plus everything you know and love.” The televised runway show was put on indefinite hiatus in 2019.

US retail sales unexpectedly flat in April. Sales rose 3 percent year-on-year in April. Consumers are focussing spending on essentials and cutting back on luxuries amid higher prices, but sales have held up as a strong labour market helped households navigate the high inflation environment.

Temu targeted in EU Consumer Group’s complaint to the EU regulator. The company often failed to provide consumers crucial information about the sellers, the BEUC said. Under the European Union’s Digital Services Act, online marketplaces and intermediaries are required to fight illegal and harmful content as well as counterfeit products on their platforms.

THE BUSINESS OF BEAUTY

Walgreens contacts potential buyers for Boots drugstore chain. A sale would undo a blockbuster transatlantic merger that took place in stages beginning more than a decade ago. The company’s stock jumped 7.2 percent to $18.43 following the news.

Natura’s losses rise to $181 million but margins grow. Natura’s first-quarter net revenue dropped 5.7 percent year-on-year to 6.1 billion reais ($1.18 billion). Adjusted earnings before interest, taxes, depreciation and amortisation rose 4.1 percent to 682.8 million reais, bringing the closely watched EBITDA margin up 110 basis points to 11.2 percent.

DSM-Firmenich unveils new ‘Mind Nose Matter’ olfactory exhibition. The showcase translated the company’s global insights consumer study into scent profiles, technologies and fragrances. It also sought to showcase the different formats, including oils, body butters, hand creams, candles and powders, brands could integrate fragrance into.

P&G to downplay corporate name in Olympic ads. The consumer goods giant plans to focus on promoting individual brands rather than its overall corporate values. Procter & Gamble has reduced its spending on Olympics advertising in the United States by 50 percent over the last several games.

Fendi launches fine fragrance collection. The seven-piece range will be available in boutiques and the brand’s e-commerce site from June 20, with each scent priced at $330. The scents are inspired by different members of the Fendi family, as well as by Kim Jones, the fashion house’s artistic director.

PEOPLE

LVMH said to shake up Fashion Group leadership. Former Louis Vuitton CEO Michael Burke is stepping back from overseeing LVMH’s sprawling Fashion Group just four months after he was named the unit’s chief executive, BoF has learned. Whether Burke will exit his role or simply take on a retooled scope remains unclear.

Haider Ackermann is Canada Goose’s new creative director. The company announced the appointment with the launch of a special hoodie, the sales of which will raise money for Polar Bears International. His first collection will follow in the autumn.

Zalando shakes up management after a strategy shift. Co-founder David Schneider will hand over his co-chief executive officer role to David Schröder in September. Schneider will remain on the management board, while fellow founder Robert Gentz will continue in his role as co-CEO.

MEDIA AND TECHNOLOGY

Condé Nast chief revenue officer steps down. During her tenure, Pamela Drucker Mann was instrumental in ushering the business into the digital age, said Roger Lynch, Condé Nast’s chief executive. Drucker Mann will remain at her post until the summer while the publisher searches for a replacement.

Compiled by Yola Mzizi.

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Background:

Esteban Cortázar first fell in love with fashion as a teenager growing up in Miami. Over the years, his career in fashion has come with lots of ups and downs. After he became one of the youngest designers to ever present at New York Fashion Week he had to shut his label down. He went on to become the creative director of Emanuel Ungaro at just 22 years old, before leaving after he disagreed with the owners’ plans to bring on Lindsay Lohan as a consultant. He relaunched his eponymous fashion house but it closed during Covid. Now, Cortázar is launching ‘Donde Esteban,’ a new brand on his own terms, on his own schedule, celebrating his roots in Colombia, Miami and Ibiza.

“Where we can lack as young designers or as designers doing independent brands is that it’s really like a puzzle,” says Cortazár. “And you have to have all of the pieces in place for it to work. Having an investor is certainly not enough, you really need to have all of the different angles in place, especially today, to be able to sustain a business.”

This week on The BoF Podcast, Cortázar joins me to share his career journey and the lessons he’s learned about building an independent fashion business today.

Key insights:

• Born to a Colombian painter and former British jazz singer, Cortazár’s childhood straddled continents, lifestyles and subcultures, all of which has greatly influenced his artistic sensibilities. “I grew up around a very bohemian environment through my family and my parents — colours and paints and oils and instruments. That already set the tone of a very artistic point of view from a very early stage,” he says.
• Emulating what he saw in the fashion magazines he devoured as a teenager, Cortazár’s early shows were always organised to a professional standard despite his young age and lack of training.
• Cortazár jumped at the opportunity to become creative director of Ungaro at the age of 22. “I knew how much questioning there was going to be from the industry about me and my age, my experience, my lack of experience. I just took it and I went for it because I knew that that kind of opportunity wouldn’t just continue to come like this.”
• Heavily influenced by his upbringing, Cortázar’s new label Donde Esteban is somewhat of a homecoming. “My take on fashion has changed and evolved and I wanted to create something that felt so authentically me, that really celebrated the multicultural aspect of my life. The fact that I was born in Colombia, grew up in Miami, then went to New York, then went to Paris, that I spent all my summers in Ibiza.”

Additional resources:

• Turning Point | Esteban Cortázar, Comeback Kid. Before the debut of his second capsule collection with Net-a-Porter, set to launch on July 17th, designer Esteban Cortázar spoke to BoF about why leaving Ungaro was the best decision of his life, his new business model, and why slow and steady wins the race.
• Esteban Cortázar Tackles Fashion’s Timing Gap. For Paris-based Colombian designer Esteban Cortázar, designing and pre-selling a trans-seasonal collection, delivered eight weeks after fashion week, is the solution to the ‘broken’ fashion system.
• Unlikely Directions at Esteban Cortázar. Esteban Cortázar’s pairing of Berlin nights and gymnastic inspiration made for a stirring, if unlikely, combination.

Since 2022, Netherlands-based tannery Ecco Leather, supplier to top luxury labels and parent company Ecco Group’s namesake shoe brand, has brought in casts of creatives to design for its collaborative project aimed at raising awareness for the material’s potential, At.Kollektive. For its fifth season, the project will get a new name — Ecco.Kollektive — and include work from British menswear designer Craig Green, Christa Bösch and Cosima Gadient, the duo behind Berlin-based womenswear line Ottolinger and French menswear designer Louis Gabriel Nouchi.

The collection, which includes shoes, accessories and ready-to-wear, will be presented at men’s week in Paris on June 20. Green’s designs for Ecco.Kollektive will also be shown in his Spring/Summer 2025 presentation in London on June 5. Prior Ecco collaborators include Kiko Kostadinov, Bianca Saunders, Peter Do and Nina Christen.

Green’s designs are more casual, menswear products. Ottolinger’s pieces are feminine and make leather look different than shoppers are used to, while Nouchi twists leather in a way that makes it appear more premium, said Panos Mytaros, CEO of Ecco. The collection will be available on the project’s site and select retailers including Ssense, Nordstrom and Kith Tokyo from November, with prices starting at €225 ($244).

Mytaros said the name change represents a maturation of the programme and was driven by a desire to make the tie to Ecco more clear.

“The goal was to unite everything we do under one umbrella … and put even more emphasis on [the fact that] there is this powerhouse behind this, and the name is Ecco,” said Mytaros.

Learn more:

Natacha Ramsay-Levi and Bianca Saunders Join New Leather Design Collective

Netherlands-based manufacturer Ecco Leather also tapped designers Kostas Murkudis and Isaac Reina to found AT.Kollektive, a new design project that aims to highlight the creative potential of leather.