Angela’s Apple: the Burberry boss swaps trenchcoats for technology

She has always had a crush on Apple and has been looking for the right US role. As the Burberry boss packs up her trench and heads for the tech giant, Rosamund Urwin on how this special relationship will bear fruit
16 October 2013

Perhaps it shouldn’t have come as such a surprise. The fashion world, analysts and investors were stunned yesterday by news that Burberry boss Angela Ahrendts would be departing to Apple — but the woman herself has dropped plenty of hints that she’d feel at home in Cupertino, California. She has championed its products in the fashion empire’s HQ, her office — a minimalist cream box — must be the envy of Apple’s design gurus and back in 2010 she declared how enamoured she was of the iPhone maker: “If I look to any company as a model, it’s Apple. They’re a brilliant design company working to create a lifestyle.”

The 53-year-old American, whose charming veneer masks a steel core, will become Apple’s senior vice-president of retail and online stores. Certainly, her record at Burberry is impressive, so much so that chairman Sir John Peace begged her to stay. Under her watch, the label has become a favourite of Hollywood starlets, the fashion press and shareholders. The stock has roughly trebled since she arrived — and news of her departure wiped £500 million off the business’s market capitalisation. But does it make sense for her to swap trenchcoats for technology?

The position at Apple has been sitting empty since the departure of John Browett who, like Ahrendts, was a well-regarded British retail boss. He was lured away from the electronics retailer Dixons with a £36 million welcome present, but was then shown the door after just six months. Browett, who is now running clothing chain Monsoon Accessorize, later confessed to a culture clash: “I just didn’t fit in with the way they ran the business.”

Browett’s staffing formula — reducing the number of recruits to its “Genius” army and cutting their hours — was said to be in opposition to Apple’s emphasis on customer service.

“The job of the boss of Apple Retail isn’t to maximise the profits of Apple Retail,” says Benedict Evans of Enders Analysis. “It’s to maximise the profits of the whole of Apple. Browett tried to improve Apple’s operating efficiencies — but Apple doesn’t want to remove these inefficiencies.”

Evans adds that Apple’s retail operation — which accounts for about 12 per cent of its revenue — is unique in the tech sphere: “It has very big, very high-spec stores in city centres — no other retailer has that combination. While their competitors rely on third parties to sell their products, Apple uses its stores to communicate that the products are great, to show customers why they want them.”

It’s a strategy that should come more naturally to Ahrendts than Browett. Burberry’s flagship store on Regent Street is part technology testing hub, part retail wonderland, part tourist attraction. It’s a neat embodiment of how Burberry’s bosses want the label to be seen: a heritage brand that is looking into the future. Or, as chief creative officer Christopher Bailey, who will replace Ahrendts, puts it, they have woven “technology into the fabric of the company.”

The instore technology includes “magic mirrors” that — once activated by chips in clothes — turn into screens. They then reveal how a garment is made and show it on the catwalk. The tills are tucked away: this isn’t about the hard sell, it’s about making customers buy into the Burberry dream.

Burberry is so keen on technology that it has teamed up with all the big names including Google and — you guessed it — Apple. Four days before its release, the iphone 5S was used to broadcast videos and share pictures at Burberry’s Spring/ Summer 2014 catwalk show. Ahrendts has repeatedly stressed the importance of technology to fashion brands — saying recently: “This is how customers live. They wake up with a device in their hand and life begins. The onus is on us to change everything we do to keep pace with the speed society is moving.”

She has also used social media to pull in a younger audience for Burberry, one which might not be able to afford the £3,495 Prorsum rabbit-trimmed leather biker jacket, but might buy a blusher or a perfume. On Facebook, Burberry is “liked” by 16.5 million users — more than any other label. Chanel can only manage 10 million.

Ahrendts once stated that her desire at Burberry was to “serve completely any consumer on any platform in any geography”. The geographical challenge is one of the tests for Ahrendts at Apple. At Burberry, she managed to give a very British brand global appeal. Her greatest success, perhaps, was conquering China, where Burberry has almost 70 stores and which currently accounts for 14 per cent of its revenues. In an indication of how desirable the brand is in China, the fashion house has hired Mandarin-speaking staff for the tourists flocking to its European flagship stores.

Apple, in contrast, has made minimal inroads there, despite its being a massive market. Retailer China Mobile sells some 30 million 3G smartphones a quarter.

“Clearly, China is a big priority,” says Evans. “Apple only has half a dozen or so stores there. They’re big stores, but you’d expect them to want to open dozens in the next few years. It currently has a similar number of stores in Japan as in China.”

Speculation has also abounded that Ahrendts may have been top of headhunters’ lists thanks to Apple’s desire to launch wearable technology. Some experts have claimed that this market could be worth more than £5 billion by 2018. Any items will need to be as attractive as they are well-engineered. So far, Google is developing its Glass frames and Samsung has the Galaxy Gear smart watch — but while there has been much chatter about Apple developing an iWatch it isn’t yet clear when, or even if, the company will actually launch it .

And despite a fashion background — Ahrendts also boasts stints at Liz Claiborne and DKNY on her CV — she is a retailer rather than an innovator. Her talent is in the art of selling.

“The fashion thing is almost a red herring,” Evans argues. “In Ahrendts, Apple is getting a vision of retail — how to package and sell a premium product. She will make a store communicate the brand experience and be a place to go, and do that on a global scale. With wearable technology, there’s something there but it isn’t quite clear what yet.”

Evans isn’t convinced Apple will even enter the market: “Apple is not Nokia or a Samsung — it doesn’t feel that it needs a product in every area. It can certainly create a product: Apple has had a prototype watch and glasses in the lab for years, but they have’t yet decided whether it’s something they want to sell.”

There has been some surprise that Ahrendts would even want the Apple job. While it’s high-profile, well-paid and at the second most valuable company in the world, she no longer gets to run the show. It’s possible the move has a personal element — as early as 2010, rumours were swirling in fashionable circles that she was keen to return to her native US. But perhaps it also reflects something else: that the line between technology and fashion has blurred. Le geek c’est finally chic.

Very fashion-apple: its stylish hires

ANGELA AHRENDTS

Chief executive of Burberry since 2006, Ahrendts is credited with turning the trenchcoats maker into a global fashion powerhouse. She was the best-paid chief executive in the FTSE 100 last year, pocketing a total of £16.9 million that included a hefty clothing allowance. Ahrendts worked hard to prove she earned it, though: getting up at 4.35am without recourse to an alarm clock.

PAUL DENEVE

The 52-year-old former CEO of Saint Laurent Paris became a vice-president at Apple in July, joining the “special projects” arm. Whispers suggest he is working on the company’s next big innovation, believed to be a smartphone-esque “iWatch”. Deneve is seen as a savvy operator and risk-taker: he brought Hedi Slimane back to fashion from photography and allowed the designer to break free from the shackles of the Saint Laurent archive and develop a new identity for the label. Deneve isn’t above wading into a fashion spat: he hit out at Women’s Wear Daily for an article setting Slimane against Raf Simons at Dior.

MICKEY DREXLER

Christened “Millard” but sensibly choosing to go by the moniker “Mickey”, Drexler is the chief executive and chairman of Michelle Obama’s favourite fashion chain

J Crew. The 69-year-old, who was the man behind Gap’s ascent to a denim store on every high street, has been on the board at Apple for 14 years. Rather predictably, he’s been dubbed “the Steve Jobs of retail”. Favours jeans, button-down shirts and blazers over suits.

ENRIQUE ATIENZA

An August hire, Atienza was senior vice-president at Levi Strauss for a year before being poached to join the tech giant’s US retail operation. Atienza, whose role covers the West Coast of the US, previously spent a decade at Walt Disney in its retail arm.

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