Is digital the key to Burberry’s brand comeback?

In the same week that Burberry unveiled its ambitious “Burberry Forward” turnaround plan, aimed at recapturing its pre-2022 momentum after reporting a £74 million ($94 million) net loss in the first half of 2024, it also doubled down on digital innovation. On November 12, the British heritage brand launched its first virtual scarf try-on experience, leveraging Web3 technology and augmented reality to allow customers to preview over 50 styles and colorways of its iconic accessory on their mobile phones. Developed in partnership with AR specialist Wanna, the tool offers two styling options – folded or draped – and generates hyper-realistic visuals that users can capture and share with friends. “Burberry’s virtual scarf try-on experience is an exciting offering that speaks to our British heritage and digital innovation,” newly appointed CEO Joshua Schulman said in a statement. “Our scarves have protected people from the weather for decades, and this festive season we’re delighted to help customers find the perfect match.” Burberry’s foray into virtual couldn’t come at a more critical moment for the brand. Following a string of losses, Schulman’s revival strategy includes a renewed focus on outerwear, a more accessible pricing structure, and efforts to reconnect with the brand’s core identity. But how does digital innovation fit into this plan? For starters, virtual try-on services have been proven to decrease return rates. For example, Yoox Net-a-Porter (YNAP) tested Deepgears’ virtual try-on technology on 90 styles from its house brand, Mr P, sold on its men’s site, Mr Porter. According to Deepgears, brands using its tech have seen an average 25% reduction in return rates and a 28% increase in conversion for items that offer the digital mannequin option. A trends report by software company Perfect Corp similarly found that brands using virtual try-on technology experienced a 2.5 times increase in sales conversion. Valentino, now led by creative director Alessandro Michele, is also gambling on technology to weather the current luxury market slowdown. Following a divided reception to Michele’s debut collection during September’s fashion month, the house has teamed up with Wanna to digitize pieces from its Avant Les Débuts Spring 2025 collection. Accessible through Valentino’s website, online shoppers can pair the brand’s Bay By Bay sneakers and 9to5 bag with their own outfits to see how well the items match before making a purchase. Some brands are opting for a more interactive approach to digital fashion. Styling gaming app Drest, which relaunched this week after a six-month hiatus, is attracting a wave of luxury labels eager to expand their digital footprints. Versace will be the first brand to debut the platform’s “Quests,” offering bespoke challenges tied to exclusive digital rewards and in-game products inspired by its new Versace Tag Bag. Meanwhile, Manolo Blahnik will maintain a permanent in-game presence, allowing players to interact with its luxury product lineup. Drest aims to democratize luxury fashion by blending accessibility with entertainment. But beyond engagement, the platform also has the potential to drive sales: after trying on digital renders of the products, users can click through to buy the physical versions directly from the brands’ websites. Web3 is experiencing a resurgence, especially after losing some momentum in recent years. Gaming platforms, in particular, are showing promising results. Roblox, for instance, has emerged as a powerful commerce tool for brands engaging younger players. In September, the platform announced that it would begin selling physical goods through its integration with Shopify. Roblox’s own virtual styling game “Dress To Impress” has evolved into a global phenomenon, pulling in around 250,000 players – ranging from tweens to adults – at any given time. Could Drest follow suit?

Is digital the key to Burberry’s brand comeback?

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Published November 17, 2024

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Is digital the key to Burberry’s brand comeback?