Luxury group Burberry has sparked controversy over cotton supply in China to signal a 55 percent increase in sales in one of its most important markets and wipe out pre-pandemic levels.
The UK-based retailer has faced a backlash in China following an international boycott of cotton grown in Xinjiang province amid concerns about human rights abuses, from which many Western retailers have sought soon to detach. Burberry relies on sales from the mainland as coronavirus-induced travel restrictions have kept the Chinese middle class at home.
Burberry said Friday that its activities in China had shown “relatively little impact” from the controversy, which encouraged a brand ambassador to leave the retailer and a video game to take a stand against it. “We just reported a 55 percent increase in sales at full price, driven by nine younger customers discovering the brand,” said chief financial officer Julie Brown.
However, sales in Europe and the UK declined “more than 40 per cent” in the first quarter, partly due to a lack of tourists due to the pandemic. In regions where many wealthy tourists come, such as Russia and the Middle East, they have increased by “double-digit amounts,” the group listed in London on Friday.
The group’s sales, however, have resumed to respond to pre-pandemic levels, rising 90 per cent to £ 475 million in the 13 weeks ended June 26 compared to the same period last year. , when the Covid-19 crisis hit.
“We’ve seen a strong recovery in [the first quarter] with comparable sales figures now in line with pre-Covid-19 marketing despite a continuing challenging environment, ”Burberry said, referring to the lack of international travel.
Chief executive Marco Gobbetti said last month that he would leave the company after five years to join Italian rival Salvatore Ferragamo, prompting investors to worry that his efforts to bring youth and glamor to the brand would lose momentum. .
Recent success on this front has included a marketing campaign with social media celebrity Kendall Jenner, which has helped promote Burberry’s Olympia bag to a younger audience.