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You might recognize a signature Burberry trench coat because of its distinctive check pattern.

When Burberry first came to life in London in 1856, CEO & founder Thomas Burberry was, at the time, only 21 years of age. The brand focused solely on outdoor attire in its early days but quickly established a reputation for quality and longevity.

In 1879, Burberry received a patent for its ‘gabardine’ fabric – a water-resistant, breathable material that it would use for trench coats. The company went from strength to strength, opening a store in the upscale Haymarket area of London in 1891, designing its signature equestrian knight logo in 1901, and supplying outdoor attire to South Pole expeditioners in 1911.

Burberry’s popularity skyrocketed after its trench coats were used by British infantry forces during the First World War. An outpour of patriotism boosted its brand identity with members of the public clamoring to buy the products after the end of the war.

Further validation came in the form of high profile celebrity endorsements by movie stars such as Humphrey Bogart in Casablanca, Audrey Hepburn in Breakfast at Tiffany’s, and Peter Sellers in Pink Panther.

The UK luxury brand is best known for its sharp coats and jackets but has also ventured out in designing shoes, scarves, bags, & other accessories. By the mid-1980s as a result of spreading itself too thin and chasing short-term profitability goals, the brand started to stagnate. What happened?

The makings of a crisis

The 70s and 80s were rewarding for Burberry in terms of its bottom line. It signed licensing agreements with many global manufacturers to design suits, trousers, shirts, and accessories and distributed them via independent retailers as well as its own stores. The effect of this expansion i.e. higher operating profits was felt well into the 1990s.

But the licensing partnerships also had an unintended effect: counterfeit products flooded markets across the world, particularly in Asia, causing price disparities that existed even in original products.

Western countries were subjected to higher rates and items were often rerouted back to markets; for example, cheaper bags in Asia were exported back to Europe resulting in a blow to its image.

Burberry had severely diluted the power of its brand by adopting a mass-market route. Once associated with list-A celebrities and daring thrill seekers, Burberry had rapidly lost its aura of glitz and glam.

Shockingly, the elitist brand was now equated with thuggery, chicanery, and hooliganism; adopted en-masse by ‘Chavs’ – a pejorative British term used to describe degenerates and lowlifes. Bouncers would turn away people wearing Burberry outfits as it was assumed they would cause trouble once inside.

Shudder.

Turnaround

“Burberry was not able to identify its target group of consumers because of its uneven distribution and licensing policies in different countries of operation,” says Arittra Basu, business development manager at Westin Hotels.

The long road to redemption started in the late 1990s after Burberry hired Rosie Marie Bravo to steer the ship. She immediately tried to stem the decline by reducing the company’s footprint in Asia, ending price disparities, and appointing a new creative head to reestablish the brand’s core values.

In 2006, Angela Ahrendts was appointed the new CEO and began a journey leading the company to reemerge as a force to be reckoned with.

Initially, there were subtle design changes. The check pattern was scaled back and started to appear less and less on merchandise. Stringent measures were adopted to crackdown on counterfeit items and the licensing agreements were gradually rescinded to centralize design and operations under one roof.

But the most important decision made by Ahrendts, along with Chief Creative Officer Christopher Bailey was the declaration of their vision to see Burberry as the world’s first fully digital luxury company.

The brand had, in their opinion, appealed to an older clientele for far too long. It was time to catch the attention of suave and fashionable millennials.

Digital would be central to the brand’s way of thinking and customers would be treated to the same experience whether online or in-store.

One of the most popular campaigns Burberry launched was the ‘Art of the Trench’, a unique play on user-generated content to bring consumers at the forefront.

Art of the Trench. Photo credit: Creativity Online

This was a standalone website where customers were encouraged to upload photos of themselves wearing their trench coats. They were featured on the main page for 15 minutes and customers could share these photos on social media feeds. There was also an option to click on a product and be redirected to Burberry’s main site to purchase it.

The campaign was a resounding success. In 2015, it was reported to have gained almost 25 million pageviews since launch.

Another hugely popular campaign was initiated to promote Burberry Kisses, a lipstick brand launched by the company. For this, it partnered with Google to enable users to send personal messages, sealed with a virtual kiss.

Users from 13,000 cities sent these virtual kisses within the first 10 days of launch.

In 2012, Burberry tried to bridge the gap between the online and offline shopping experience via its Regent Street London store. The store featured huge screens where catwalk shows around the world could be viewed live and the individual products were available for instant purchase.

“Burberry Regent Street brings our digital world to life in a physical space for the first time, where customers can experience every facet of the brand through immersive multimedia content exactly as they do online,” said Burberry CEO Angela Ahrendts. “Walking through the doors is just like walking into our website.”

Not only can shoppers buy online from Burberry’s digital properties, they can also choose to pick up in-store or have a sales associate order from the website for them while visiting an outlet. Burberry’s also experimented with flash commerce features via Twitter as well as allowing users in China to order via WeChat.

In China Burberry took the unusual route of opening a store on Tmall; a strategy consistently avoided by upscale brands. The move was meant to counter the growing grey market for its goods as well as embrace the Chinese penchant for online shopping.

Its savvy use of social media has also engendered the growth of a loyal community. The brand has embraced Snapchat to provide peeks into upcoming lines and fashion shows. Burberry’s YouTube channel has over 300,000 subscribers and hundreds of videos that not only showcase trench coats, but also includes makeup tutorials, music jams, and other engaging content.

And the result of all of this? In 2011 Business Insider placed Burberry in the top 10 brands of the world with a growth percentage of 86% as judged by an estimate of its brand value. That far outstripped any other company on the list.

Burberry shares, which languished in the $200 range in 2002 now trade at $1,539.

Of course, challenges persist. Weakening demand for luxury brands hurt Burberry’s profitability last year with the CEO saying that the product range “needs to be refreshed”.

But if it continues with its sharp focus on digital and out-of-the-box thinking, it should be able to weather the relative storm.

“Burberry’s digital strategy […] has so far not only put it at the top of the fashion luxury category but among top players across industries,” wrote Digiday.

It’s hard to escape news of changing consumer behavior and ongoing retail ‘disruption’, especially amid the year’s largest sales. An evident signal of this shift has been the steady decline in foot traffic to once widely /lopular Black Friday sales in shopping malls.

Net sales on Black Friday slid 10.4 percent for brick-and-mortar chains, according to RetailNext.

For digital-first businesses, launching online is a no-brainer. But what happens when you are an existing brand that is over 80 years old working with hundreds of distributors around the world? Speed and simple decision making are out of reach.

At the Shangri-La at the Fort Manila, four brands – Abbott, Unilever, Payless, and Titan22 – each leaders in their own categories, were brought together by ecommerce enabler and e-distributor aCommerce to candidly share customer preferences, impact of traffic congestion and what must change internally in order to stay relevant in the future.

This is what was discussed:

1. More Filipino men pushing the carts

“There’s a lot more male shoppers going for groceries, it used to be the woman that was in charge of nutrition labels, but now they tell men to do it,” says Christian Domingo with a laugh. He is the Head of Ecommerce for Abbott Philippines.

Findings from a recent Nielsen study show that 40% of today’s grocery shoppers in the Philippines are men, an increase of six percentage points from last year. The driving factor? Affluent Metro Manila residents, especially in dual-income households.

Nielsen

Grocery shopping behavior for men and women in the Philippines. For more charts & graphs, visit here.

What this means for brands is to rethink marketing strategies traditionally targeted towards women.

Referencing another study, Christian attributed the popularity of ecommerce to worsening traffic conditions in the Philippines. CEO and owner of Titan22, the top sneaker retailer in the country, Dennis Tan, also shared his experience.

“The customer decision window is getting shorter and shorter. It used to take days where people thought about purchases and then come back to it but now the entire process seems to happen with minutes.”

He should know as Titan sold 400 pairs of Jordan Elevens during Single’s Day (11.11) in the first hour online.

“I won’t drive for hours for a chance to get the right shoe size. Consumers have a lot of options where to buy products, so we need to offer a competitive advantage.”

2. After-sales is as important as the purchase journey

Ecommerce is commonly misinterpreted as the shopping experience on a website but what gets forgotten is the attention given to the steps that come after checkout.

“How a customer feels after the purchasing experience is a big factor to the entire happiness experience to retail. This is one of the big pieces,” comments Dennis.

“We need to give them inspiration, not only about the shoe, it’s about happiness guaranteed,” agrees Thea Lizardo, Head of Ecommerce for Payless Philippines (Footwear Specialty Retailers Inc.).

3. Internal processes causing friction, there needs to be unified commerce

aCommerce, ecommerceIQ

Christian Domingo and Thea Lizardo from Abbott and Payless, respectively.

“It’s not typically mentioned but an important factor to talk about is the hurdle of internal friction in terms of technology. There’s a lot of confusion around how we attribute sales,” mentions Thea. “ These discussions are vital to transforming the entire business.”

“How do we remain competitive? How do we keep customers? It’s overwhelming for brands and business owners to adapt to all the changes because it’s so quick but at the end of the day, it’s understanding your numbers, your customers, your behavior and leveraging it.”

“Internally, there is no P&L, who is going to own the digital marketing unit? The marketplace?” comments Christian.

“It’s recommended [at Payless] to have a separate P&L, separate ERP for our ecommerce business as we didn’t want to disrupt the other 76 stores,” replies Thea.

Another internal roadblock Christian hopes to push through is the company’s (lack of) unified shift to ecommerce.

“We are selling milk online but other product divisions such as diabetic drugs need the push. They have hurdles like FDA approval, internal conflict, etc. but what we envision for 2018 is to go beyond the brand because it’s the user looking for a solution to a problem.”

“We [Unilever] have a long heritage selling fast moving consumer goods but we need to move things faster,” closes Kay Veloso, Head of Ecommerce for Unilever Philippines.

“It’s [unified commerce] not an unachievable dream, it’s a basic expectation. B2C, B2B – we serve the entire ecosystem to get the pulse of people we serve, and continue to adapt our brands to ensure their day to day needs are met through ecommerce.”

aCommerce, ecommerceIQ

Kay Veloso at the aCommerce Philippines Partner Media Workshop

4. Data and mobile will pave the retail future

Each brand has their own ideas about the main focuses for 2018. Unilever Philippines hopes to e evaluate its mobile experience to understand if it’s delivering the brand message across the board.

“Omnichannel is the big trend that is here to stay in the Philippines. We need to provide consistent online and offline experiences and preserve the quality of our products both instore and online,” comments Kay. “80% is coming from mobile websites and the Philippines is actually the fastest growing mobile market in Southeast Asia.”

Payless Philippines wants to leverage its data to better utilize its offline stores to become more customer oriented and explore new channels.

“How can we leverage the 76 Payless stores and unify them to serve our customers better? We have online data, consumer data so we can map out our merchandising plan for various locations.”

“Social commerce, exploring the space that we’re not in [social media] but also stores (they can be turned into fulfillment centers). Customers are becoming brand agnostic. We need to capture them when they are on their devices, not only at the mall, people no longer go online, they live online.”

Titan, on the other hand, will focus on expansion through ecommerce to meet the demand growing outside of Metro Manila.

“The challenge for Titan is all our physical stores are in Metro Manila while 50% of consumer base is outside Metro – we will continue to build on it and see what role innovation really plays for us.

“At the moment, ecommerce is more defense than offense, but when you start playing offense is when you start to win.” — Dennis Tan, CEO and owner of Titan22

“It used to be that companies had to set up a website because everyone was doing it but the companies that have their own internal ecommerce teams are the ones that are most successful, you need to be ones to drive and grow it in the organisation.”

Dennis Tan from Titan22


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Instagram celebrated the first anniversary of IG Stories earlier this month. In one year, the platform has become one of the most important online channels for brands to reach customers as more than 70% of IG users follow a brand page and 22% of shoppers have regularly used Instagram to browse products.

With 250 million daily active users, Instagram Stories has become a new favourite tool for marketers as half of the businesses on the social channel have produced a story in the last month alone.

Its appeal comes from the contrast of Instagram’s two functions; the polished image shots and the “raw” side of the capture process.

“Within the same platform now we’ve got this lovely juxtaposition that allows you to tell a richer story, but maybe [providing] a more authentic, or more earthy experience alongside the more polished core visuals,” said Hugh Pile, CMO L’Oreal Western Europe.

Instagram Stories Brands

L’Oreal’s post on Instagram Stories

However, with so many advertising channels now available to brands, it is important to know what is the right content to produce on Instagram Stories for success.

The path to conversions

There are five main categories of activity that brands can encourage users to do with the feature in the ads for Instagram Stories, but shopping is the most popular objective for brands as 59% of the ads Stories produced since its launch in March linked to a page where the products featured in the ads were available online.
Instagram Stories Brands

 

“Instagram has integrated ecommerce handoff technology into Stories, namely swipe-up links leading to brand sites, linked influencer tags, and checkout buttons that support brand efforts to move beyond engagement metrics and render their live video content shoppable.” – L2

Brands also use Stories as a gateway or teaser to drive traffic to more elaborate content on platforms like Youtube or Facebook where shareability and engagement are more likely with the user.

Product promotion is still the most popular type of content in Stories, which accounted for 36% of content produced by brands, followed by ‘behind-the-scene’ pieces, and influencer endorsement.

Instagram Stories Brands

Video has also increasingly become a more effective media format that drives online shopping – 34% of Indonesian youth were influenced by video ads to shop online.

With more tools available for brands to engage consumers, especially in a market like Southeast Asia where online marketing channels are dominantly Google and Facebook, it’s time for brands to get more creative.

THE BACKGROUND

Derived from Danish phrase leg godt, which means “play well”, LEGO has been a fundamental companion to children and adults with its trademark interlocking bricks.

Founded in 1932, the toy company learned an important lesson of staying true to your brand the hard way.

When the company posted a loss in 1998 for the first time in its history, an internal audit found that no significant innovation had been made in the company for a decade.

It caused the company to hastily diversify its portfolio to include sectors it had no experience in.

This resulted in the company launching electronic toys, dabbling in video games, launches its own clothing lines and watches, and even building theme parks.

LEGO in Asia

Although eventually successful, LEGOland was a financial burden during its first creation and was sold to Merlin Entertainments.

Their attempts at disruption only succeeded at alienating fans and driving the privately-held company almost to the brink of bankruptcy.

With $800 million in unpaid debt in 2003, LEGO’s then CEO Jørgen Vig Knudstorp was convinced that the company was on a path to crash and burn.

“We’re running out of cash.. [and] likely won’t survive.”

The path to LEGO’s revival started in 2004 when Knudstorp began enforcing cost-cutting decisions and selling any LEGO’s business subsidiaries unrelated to the core product.

These actions steered the company back to its ‘brick’ business and the company began listening to the needs of its customers once again.

LEGO in Asia

Lego figure of Jørgen Vig Knudstorp, LEGO CEO who led the company out of the rut

13 years later, revenue increased five-fold and returned to profit. LEGO was named the most powerful brand in the world earlier this year and posted the highest revenue ($5.7 billion) in its 85 years history.

Now they’re looking at Asia.

THE CHALLENGE

Despite record-breaking results, the company’s sales grew only 6% this year after experiencing five years of double-digit growth. In LEGO’s biggest market, the US, sales fell flat despite a significant increase in marketing spend. The company also had to increase prices in the UK after the weakening of the pound following Brexit.

With an already high profile and static demand in mature markets where two third of its revenues come from, the company is hard-pressed to expand – enter Asia.

Although the toy company has been present in the region for the last three decades, LEGO believes that it still hasn’t unlocked Asia’s untapped potential where almost 60% of the world’s children reside.

Conquering Asia isn’t easy as the company faces several issues that are unique to this marker, namely having to price items for higher due to import duties and lack of an expansive retail footprint — causing LEGO to have to work with small distributors to reach audiences across single markets.

There is also a big difference of culture, where ‘play’ is defined differently and not considered as important for young children.

THE INNOVATION

In November 2016, the company opened its first factory in Asia (its fifth globally), located in China’s eastern Zhejiang province and an R&D hub in Singapore.

The decision to open the factory in China was motivated by the company’s 50% increase in sales from 2013 to 2015 in the country.

The 40-acre factory is expected to cut distribution costs and lower the price for customers in Asia. It’s also expected to produce 80% of the demand coming from mainly Japan, Korea, and Southeast Asia.

LEGO also opened its largest retail store in Shanghai on a mainstreet outside of Disneyland, as testament of its confidence in its belief that China will be its third biggest market after the US and Germany.

LEGO in Asia

The opening of the LEGO Store in Shanghai

In terms of digital marketing, it seems the company is tailoring their efforts to target certain demographic groups.

The company is not only popular with children but also appeals to adult fans, particularly in Asia where over 80,000 of them are.

When the company launched its limited edition Architecture series – the first product line made for adults – they featured Seoul’s Sungnyemun Gate and Tokyo’s Imperial Hotel to appeal to Koreans and the Japanese.

LEGO in AsiaLEGO also granted tech-savvy Japan early access to Cuusoo, an online tool that allowed users to design their own LEGO designs in hopes of creating local buzz around its products.

In more recent news, a year-long ‘Build Amazing’ campaign was launched in April in Singapore – a highly family oriented country-state – to encourage parents to think differently about the definition of success and emphasize LEGO’s role in in children’s development.

LEGO in Asia

“The picture of success can be anything, it all depends on what that child wants to envision for their own life. This generation [of parents] are starting to think differently, as in there is an element of creativity and imagination that can help foster that, it’s not a one way route anymore,” said LEGO Senior Regional Brand Manager, Kevin Hagino.

To further its position in the market, LEGO expands its reach through online channels, by selling through e-marketplaces including the Lazada and Central.

LEGO in Asia

LEGO official store in Lazada

THE STRATEGY

Earlier this year, the widely applauded Jørgen Vig Knudstorp stepped down from CEO to head LEGO Brand Group. The division focuses on building long-term brand potential as the parent company expands overseas.

“Our long-term ambition is to provide the opportunity for millions more children around the world to benefit from LEGO play experiences, especially in emerging markets,” said Bali Padda, LEGO’s current CEO.

By building on its presence in Asia, LEGO is trying to become what it calls a “third leg on the stool” to complement its traditional markets, Europe and the US.

“What we’re trying to achieve is to have a major presence in all three regions so we can have a natural hedge on currency flows,” revealed Knudstorp.

THE FUTURE

As the toy industry is poised to grow bigger and new-gen parents in emerging markets can afford to be more open and attentive to the needs of their children, LEGO is in a good position to win the market, even in the emerging ones.

Here’s what you should know today:

1. Facebook will open an office in Indonesia

Indonesia’s favorite social network site Facebook will open an office in Jakarta later this month as part of the requirements for its operation in the country.

Samuel Abrijani Pangerapan, Communications and Information Ministry director general of information applications, said the office will be opened as a permanent business entity in South Jakarta.

Facebook will also establish specific business activities (KBLI) as required by the existing regulations for the type of business run by Facebook. The company also expressed its commitment to deal with prohibited content on radicalism, terrorism and pornography.

Read the full story here

2. honestbee celebrates second anniversary with regional expansion

Singapore’s online grocer honestbee celebrates its second anniversary this month by cementing its position as the largest and fastest fresh grocery ecommerce service in the region.

In addition to its groceries service, honestbee also expand to other business verticals like food and laundry. honestbee plans to become the most convenient on-demand services marketplace.

Within two years, honestbee has presence in eighth city, including Singapore, Hong Kong, Jakarta, Kuala Lumpur, Manila, Taipei, Tokyo and Bangkok.

Read the full story here

3. Recommended reading: Where are the Southeast Asian brands?

The latest BrandZ Top 100 Most Valuable Global Brands report revealed that tech companies are thriving, but it’s also exposed the absence of Southeast Asian brands in the global rankings.

However, the arrival of a brand in the global Top 100 from Southeast Asia should not be far as economies in the region grow, populations swell and mass mobile adoption levels the playing field (and reduces the cost) of delivering widespread reach.

Read the full story here

 

Workers aged 30-34 claim the highest average gross income levels in the Philippines. And as the relatively young population is set to see a surge of middle class households – especially the single person household – for the next 13 years, strong growth is predicted for the following industries: clothing, footwear, hotels and transport.

Despite an increase in the middle class, the social class E (lowest income class) still remains dominant and represents a bigger market for low cost food, housing and apparel.

The impact of the increasingly affluent Filipino shopper should not be overlooked by global brands as the current focus of many companies is trained on larger markets like Indonesia and Thailand. Traction in the market could easily be tested through a social media campaign as Zara did for Thailand as Filipinos are highly active on social channels. The best way to reach new consumers is through a channel they are already highly active on.

ecommerceIQ

Zara Thailand announcement of online shop on Facebook.

Japanese clothing brand Uniqlo and Nestlé are two global brands that stand out in the Philippines through social media campaigns to attract the country’s almost 40 million Facebook users, a number that is expected to jump to 47.5 million next year.

Nestlé’s Facebook rewards scheme that was launched in 2011 encouraged followers to invite friends to ‘like’ the page in order to win points and prizes. The coffee brand also sells on Lazada and incentives shoppers on Facebook with discounts and promotions.

Earlier this year, Nestlé was awarded by Youtube for releasing one of the most popular Youtube ads in the Philippines. Some other popular campaigns include: 

Youtube Ads Philippines

Uniqlo, on the other hand, has been speedily launching offline stores in popular shopping locations but does not currently offer ecommerce in the Philippines. The company’s recent and successful launch of its shoppable website in Thailand could persuade the brand to move forward with a similar strategy as the markets share similarities.