How Burberry became the top digital luxury brand - Digiday
6/9/16, 6:14 PM
How Burberry became the top digital luxury
brand
Hilary Milnes (http://digiday.com/author/hilary-milnes/)
@hilarymilnes (https://twitter.com/intent/follow?screen_name=hilarymilnes)
December 2, 2015
2873
In 2006, Burberrys former CEO Angela Ahrendts and chief creative officer
Christopher Bailey declared that they wanted the brand to become the first fully
digital luxury company. Today, digital has become a core component of how Burberry
runs its business, and its reaping the rewards in a category that has notoriously
lagged in digital savviness.
Burberry was early to turn user-generated content into its own social media platform
(the Art of the Trench), which it launched in 2009. After that, it has been among the
first to test new social media channels and developments: it jumped on Snapchat and
Periscope, and tested Instagrams video ads and Twitters buy buttons as they rolled
out. At the end of 2014, Burberry upgraded its mobile site, which resulted in its
mobile revenue tripling.
Bailey, now CEO as well as chief creative officer (Ahrendts departed in 2014 for a
position at Apple), cited digital technology as central to the brands way of
thinking. For customers, that means they have access to the brand in a way that was
previously unheard of in the luxury world. For Burberry, that means treating
customers the same way no matter whether they are online, in-store or on mobile.
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How Burberry became the top digital luxury brand - Digiday
6/9/16, 6:14 PM
This focus on digital has landed Burberry at the top of digital think tank L2s 2015
Fashion Digital report (http://www.l2inc.com/research/fashion-2015), released this
week. The report is an annual index that ranks top fashion brands on their successes
and failures in digital commerce and marketing, and Burberry outdid 82 other brands
in digital, for its mobile platform improvements, a digital microsite, social
engagement and brand visibility.
After that initial fully digital announcement in 2006, the first act in going fully
digital came in 2009 with the launch of Art of the Trench
(http://artofthetrench.burberry.com/), a microsite that runs user-generated content
of people wearing Burberrys signature trench coat. That year, during the
Spring/Summer 2010 fashion show, Burberry chose to live stream the event, giving
anyone access to the traditionally exclusive runway action.
(http://digiday.com/wp-content/uploads/2015/12/Screen-Shot-2015-12-01-at-12.45.53-PM.png)
Art of the Trench on Burberrys site.
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How Burberry became the top digital luxury brand - Digiday
6/9/16, 6:14 PM
L2 pointed to the continued investments in both of these displays as reasons why
Burberry has forged ahead in digital. Thats noteworthy in the luxury world, which
often sees digital as a mass-market that can dilute a prestigious brand, but as L2s
report mentions, the stark reality for luxury brands is the brand equity that took
decades to build does not translate properly online. (According to Reuters
(http://www.reuters.com/article/2015/10/29/luxury-bainidUSL8N12T3IM20151029#qG0rGf8XtbV4L3aI.97), the whole of the luxury goods
market grew only 1-2 percent in September, while Burberrys revenue was up 11
percent.)
Pulling digital all the way through a strategy for luxury retailers is a rarity and needs
top-down vision, said Amy Gale, associate planning director at Isobar US. Its sad
that Burberry is one of the few that come to mind here.
In 2014, Burberry expanded Art of the Trench to have a much bigger reach. Art of the
Trench now taps into all of Burberrys global markets, as 1.4 million people have
watched the reintroduction video and the site has received 24.8 million pageviews to
date. During the Spring/Summer 2016 fashion show, Burberry also went beyond live
streaming, and shared shots of the entire collection on Snapchat before it premiered
on the runway, to the tune of 100 million impressions.
Its a rare ability to revitalize legacy investments, said L2s report. Another
continuing investment for Burberry is its annual Christmastime video, this year titled
The Burberry Festive Film starring Romeo Beckham. Last years video, From
London with Love, garnered 9.5 million views and is the fourth-most-watched brand
video.
(http://digiday.com/wp-content/uploads/2015/12/Screen-Shot-2015-12-02-at-9.20.25-AM.png)
Source: L2 (click to enlarge)
Burberry has also figured out a way to capitalize on those watching its every move on
the runway something other designers have failed to do even as the social mentions
roll in during fashion week. In 2013, it offered a made-to-order catwalk service, which
sold runway pieces from the Spring/Summer 2014 collection online and on mobile
immediately after the show ended, for a two-week period. In China, Burberry tested
instant orders via text message on WeChat.
The goal is to bring the customers closer to the brand.
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How Burberry became the top digital luxury brand - Digiday
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Burberrys campaign announcement on Snapchat.
Burberry has a robust digital team, and that the content shared on platforms and on
mobile is all created internally. That includes Octobers advertising campaign on
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Snapchat, with photos of each item in the ads collection shot by Mario Testino,
Periscope footage of a Live in London event and the mens fashion week runway, and
(HTTP://DIGIDAY.COM/) curated playlists for Apple Music, where Burberry created the first brand channel for
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the platform.
On digital channels, Burberrys goal is to be consistent. Shoppers can now buy online
Why Starbucks' secre
'Pink Drink' is becom
an Instagram sensatio
and pick up in-store, have a sales associate order for them from Burberry.com while
(http://digiday.com/brands/starbu
in-store, and access a unified shopping cart on mobile and desktop. Synchronizing
secret-pink-drink-becoming-
channels has made it easier for Burberry to expand into new markets, like Japan and
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Korea, and enable shopping through social platforms. Burberry also ran Twitters buy
button in conjunction with a 2014 fashion show shortly after Twitter introduced the
feature, making mobile purchases instant.
Burberrys digital strategy, which the brand plans to continue to evolve into 2016, has
so far not only put it at the top of the fashion luxury category but among top players
across industries.
At this point, Burberry has established itself as a digitally savvy brand among other
industry barons Apple, Nike, and Google, said L2.
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How Burberry became the top digital luxury brand - Digiday
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'A smoke-and-mirrors model': Why YouTube
networks feel forced to change
Popular
Sahil Patel (http://digiday.com/author/sahil-patel/)
@sizpatel (https://twitter.com/intent/follow?screen_name=sizpatel)
17 hours ago
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Its a time of change for YouTube networks. Once the darlings of the venture capital
and media worlds (http://digiday.com/publishers/youtube-networkacquisitions/) because they were able to aggregate gargantuan numbers on YouTube,
these so-called multichannel networks are now aggressively pursuing newer, more
diverse business models that arent necessarily talent-first.
Take, for instance, Fullscreen. The company started out as a YouTube juggernaut,
aggregating tens of thousands of channels into a single content-management
Chat app Viber
takes the wraps off
its native ads
(http://digiday.com/brands/chatapp-viber-takes-wraps-off-nativeads/)
system, which it then used to sell YouTube ad inventory while also representing top
talent on content and advertising deals.
Fullscreen maintains that its creator business remains important. Its how they got
started, after all. But with big Hollywood agencies and managers clamoring to sign
the top stars, talent management is not necessarily the primary focus any
more. Theyre still happy to provide various tools and services to the middle-lower
tiers, because there is some money to be made there while the businesses focus on
other, potentially more money-making areas.
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How Burberry became the top digital luxury brand - Digiday
6/9/16, 6:14 PM
Indeed, Fullscreens ad business will pull in as much money this year as its creatorservices business does, according to Fullscreen COO Andy Forssell. And in the next
five years, the creator business is expected to double, whereas the advertiser
side could multiply by five or six times. Were not pulling off the pedal with our
creator business, but as we look to grow even more, were going to move into other
areas, said Forssell.
Diversify or die.
Simply put, the big YouTube networks are diversifying. Fullscreen now calls itself
Fullscreen Media. And its business is no longer just selling YouTube ads. It still has a
creator division focused on talent management for top stars and various audiencedevelopment and monetization services for smaller ones. But two newer divisions
include Fullscreen Entertainment, which oversees the companys subscription
streaming networks and live events, and Fullscreen Brandworks, its agency services
and influencer marketing arm.
Similarly, Maker Studios, now owned by Disney, has made a significant push into
creating original content of its own. It has produced shows on Verizons Go90
platform and YouTube Red. Later this month, it will premiere the mockumentary film
Internet Famous on iTunes. With its parent company, Maker has a program to
develop original programming for digital platforms, with the potential of the best of
the best to make it to TV, the companies have said.
The reason for the scramble to develop new business streams is as clear as it was
inevitable: YouTube pre-rolls do not a business make.
[The old MCN approach] was a smoke-and-mirrors model: amass as many channels
as possible and then when we report numbers, we are reporting an aggregate number
of people who signed contracts, said an executive at a top YouTube network.
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How Burberry became the top digital luxury brand - Digiday
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This helped sway investors and media companies, which poured a lot of money into
Fullscreen, Maker Studios and other YouTube networks. But even with hundreds of
thousands of subscribers across a network of channels, the margins make it an
impossible business. The YouTube networks take home only 17 cents on every dollar
generated from pre-rolls.
Hence the drive to launch new business initiatives that go beyond YouTube ad sales.
They are taking care of themselves right now, which is not a crime, said a web video
veteran who has worked with many of the major YouTube networks on various
content and distribution partnerships. All of these guys are now owned by bigger
companies, and theyre being pushed to show the growth they promised. That doesnt
come from the pure MCN model.
For most creators, the story hasnt changed.
As YouTube networks focus on their new businesses, there are no guarantees that
most creators especially those without millions of subscribers and Hollywood
agents wont end up as collateral damage.
Take, for instance, Maker Studios. It no longer accepts anything under $250,000 for
work it produces with a client and a creator, said a source. For talent that it represents
exclusively, it will sometimes book smaller-sized deals, but those creators, as well as
others in the network not exclusively represented by Maker, are free to find their own.
Every YouTube network now has a minimum price for branded content deals. Its
given rise to a new crop of influencer marketing firms and platforms like Izea and
FameBit, which also promise to match smaller creators to brands. (Internally, Maker
and Fullscreen have similar platforms.)
Fullscreen, meanwhile, is open to buying shows featuring talent from rival networks
for its fledgling streaming service. In fact, it offered the Maker Studios film Summer
Forever upon launch.
In this environment, a majority of creators in the large networks might be less
inclined to remain loyal to their network.
One executive at a vertical-focused YouTube network said his company has seen a lot
more inbound interest from creators looking to defect from the larger networks. I
dont want to remind the bigger networks who sometimes hire us for campaigns
that people are defecting, he said. The amount of switching creators are doing from
network to network is at a constant churn now.
Which means the traditional YouTube network model one which made them out to
be more talent management firms no longer applies. Theyre trying to be studios or
networks (or both) now.
If the MCNs were created to find a way to significantly reward all digital creators,
then they didnt do it, said the web video veteran. The problem is not solved. If
Fullscreen is successful, Fullscreens problems are solved; the problems of MCNs [as
a whole] arent.
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