Apple bets on Burberry chief to burnish retail shine

Tue Oct 15, 2013 7:58pm EDT
 
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By Poornima Gupta and Guy Faulconbridge

SAN FRANCISCO/LONDON (Reuters) - Burberry CEO Angela Ahrendts rebuilt the British luxury brand after excessive exposure of its trademark checkered pattern alienated wealthy clientele. Her approach was to embrace digital innovation, build a strong online business, and tap Chinese and Latin American markets.

Now Apple Inc is hoping she can do the same at the world's most valuable technology company.

In hiring Ahrendts to direct strategy, expansion and operation of Apple's retail and online stores, Chief Executive Tim Cook has set her the task of bolstering iPad and iPhone sales, and returning some lustre to a brand that has not launched a major new device in almost four years.

One of her main challenges will be to boost Apple's sales in China, its second-largest market. Here, analysts say, Ahrendts will be able to draw on her Burberry experience of introducing less expensive goods without damaging the value of the brand.

"The point of Apple retail is to sell Apple, not to sell Apple products," said Benedict Evans, who covers mobile and digital media at Enders Analysis, a research consultancy.

"What they've got is somebody who can take 400 stores with really great premium positioning and turn that into 800 stores and do that in China, and do that in India and do that in Europe and in Russia and in South America and everywhere else which at the moment they don't really have."

Ahrendts is the first woman to join Apple's executive team in nearly a decade and will take on an expanded role, overseeing its vast network of stores that employs about 42,400 people and online teams. Apple has not disclosed how much she will be paid.

The head of the 157-year-old Burberry Group Plc was Britain's highest-paid CEO in the 2011-2012 financial year, taking home 15.6 million pounds ($25 million) thanks in part to a large number of shares awards. She took home 6.8 million pounds in the 2012/13 fiscal year.   Continued...

 
Burberry CEO Angela Ahrendts speaks at the IHT Heritage Luxury conference in London in this November 9, 2010 file photo. REUTERS/Paul Hackett