Angela Ahrendts checks Burberry in as a global brand

Angela Ahrendts is masterminding the global expansion of the 150-year-old luxury clothing firm, writes Jenny Davey

IT was a sunny autumn day in 2005 and Angela Ahrendts, the newly appointed chief executive of Burberry, was on a trip to New York where she had arranged lunch with Christopher Bailey, the group’s brand director.

The location was the Asiate restaurant perched above the Manhattan skyline on the 35th floor of the Mandarin Oriental hotel.

The scheduled one-hour meeting stretched well into the afternoon and Ahrendts and Bailey spent more time talking than eating as they planned the biggest rejuvenation of the British luxury fashion brand since it clothed soldiers during the first world war.

Over the past three years, the blueprint drawn up that autumn day has taken Burberry on the most ambitious global expansion drive in the company’s 152-year history. Burberry is now about much more than trench coats. Welcome to the world of £1,500 handbags and luxury shoes.

On the face of it, Bailey and Ahrendts should have little in common. Bailey is a 36-year-old Yorkshireman who still has a house in Halifax. Ahrendts is American-born and 11 years his senior. But the working relationship between the two is so strong that when Burberry moves into its new headquarters on Horseferry Road in London’s Victoria later this year, they will have interlinking offices.

“I still feel like his mother,” Ahrendts giggled in her first newspaper interview since taking the helm. “But he’s a great talent. He’s from Yorkshire and I’m from a small town in Indiana, but we have a lot of values in common and, in an industry where you have to divide and conquer, it goes a long way.”

Bailey, who first met Ahrendts when they worked together at Donna Karan, is equally complimentary. “She’s my partner in crime and she’s a pleasure to work with. She has an unbelievable energy and passion and drive and she is a great strategic thinker. Neither of us grew up in mansions or flying on fancy aeroplanes - but I don’t think luxury has to be about money. We are both very grounded and we want the brand to speak to lots of people,” said Bailey.

Watching Ahrendts bounding around her bright, white office in London’s Regent Street, Bailey’s reading of her proves apposite.

She is is still statuesque at 47 – and she effuses a bubbling energy that is instantly disarming. She described herself as a “merchant” as she pointed to products in marketing brochures that cascaded over her white-and-grey marble desk.

So what is her favourite item from the Burberry collection?

“One favourite thing?” she shrieked in mock horror like a child who had just been told he can have only one toy at Christmas. “Oh I know, the Warrior mega-check bag. We’ve sold out . . . but it’s absolutely gorgeous – that is going to be my summer bag.”

When Ahrendts joined Burberry, the company had already made strides under previous boss Rose Marie Bravo, but it was clear that if the upmarket British fashion house was to succeed in its aspiration to become a global luxury brand it needed to be more innovative, increase its quotient of top-end merchandise and develop slicker marketing and product delivery. Crucially, Ahrendts has ensured that new merchandise flows into stores more evenly throughout the year.
One of her first actions as chief executive was to put Bailey in charge of all things that customers saw – from store design to product – across the Burberry global empire, to ensure it had a consistency of approach around the world.

“Our vision was to leverage the franchise – we wanted to purify the brand range and cut through the clutter. Luxury customers travel a lot and they want the same experience wherever they go, whether that is the same cup of coffee from Starbucks or the same phone from Apple.”
Ahrendts has expanded the brand into luxury handbags, shoes, small leather goods and soft accessories while staying true to the brand’s heritage as an outerwear brand, best known for its signature check.

Today the shelves of the group’s stores contain an array of products from quilted gold ballet pumps and the Knight bag – photographed on the arms of celebrities Cameron Diaz and Sienna Miller – to its centrepiece, the alligator-skin Warrior handbag that sells for £13,000.
Is the goal to be a Louis Vuitton? “No, the goal is not to be on a par with them – our peers do an absolutely brilliant job – but this is not about us trying to be someone else.

“In the world of luxury it’s really about looking less at what they do and more about doing what we do better. Our position is so modern, it’s not really edgy or trendy.”

It is clear she is excited by the potential to grow the Burberry brand in emerging and underrepresented markets.

“Everyone talks about China, but look at markets like Vietnam, Malaysia, Macau. We have signed eight new flagships in Asia in the past month. Look at that whole eastern Europe and Russia area, or go over to Dubai and then think Kuwait, Egypt. India is opening up . . . that is another whole region.”

Ahrendts has also shown herself to be capable of taking tough, politically unpopular decisions such as the closure last year of the company’s shirt factory in South Wales – in the face of criticism from Prince Charles, MPs and singers Tom Jones and Charlotte Church. Production was shifted to China.

On the face of it, her strategy is beginning to pay off financially – with revenues up 23.3% to £254m in the third quarter, boosted by growth across all product channels and geographic regions. But fears that Burberry will suffer more than some of its peers if there is a sharp downturn in consumer spending and a warning note from the company that it will be a “stretch” to meet its full-year pretax profit target of £210m have punished the share price. Since last May it has plunged more than 40%.

Ahrendts is sanguine. “It’s simply timing . . . as long as we put up consistent numbers quarter after quarter. It’s like your weight: you don’t get on the scales every day, you should just watch your diet. It’s a waste of time for executives to worry about the share price – I believe we are the greatest growth story in the sector. That’s not being overly confident.

Talking about how trading is going is always sensitive for a listed company, but Ahrendts insisted: “On aggregate we are holding our own. I do feel we have some wonderful momentum right now. We’ve just got to stay focused on the things you can control and keep getting a very clear and focused message across to customers.”

The daughter of a model, Ahrendts grew up as one of six children in a humble family home surrounded by wheat fields and farms in New Palestine, Indiana. As a teenager she dreamt of a big-time fashion career and carried around the latest edition of Vogue for a month at a time. She was so determined to cut it in the fashion business that she moved to New York the day after she graduated from Indiana’s Ball State University in 1981.

She began her career at Donna Karan and worked her way up the ranks, eventually serving as president of the upmarket Donna Karan Collection. After a brief stint at the retailer Henri Bendel, Ahrendts joined Liz Claiborne in 1998, rising to become vice-president.

Despite her high-powered job, Ahrendts, a mother of three, remains remarkably grounded. She said this was because she prized family above all else.

“I’m a mom first – I have to be a wife and mother – it’s so important that I have balance.”
She talks affectionately about family evenings spent eating a takeaway pizza, watching her three children, aged 13, 12 and 7, play car games on their Xbox games console, larking around playing basketball with them or hosting sleepovers for their friends.

“Nobody will ever remember that I worked for Burberry. But raising my kids to be confident and intelligent will stay with them for as long as they live.”