Burberry Names Versace’s Akeroyd as New Chief Executive
Burberry Names Versace’s Akeroyd as New Chief Executive
(Bloomberg) -- Burberry Group Plc chose Jonathan Akeroyd from Italian fashion house Gianni Versace SpA as its new chief executive officer, tapping a proven turnaround expert to continue the trench coat maker’s push to become a top-tier luxury label.
Akeroyd, a 54-year-old Briton who led the revival of Alexander McQueen before taking over at Versace, will join the British brand in April. He’ll replace Marco Gobbetti, who is leaving to run Salvatore Ferragamo SpA.
Akeroyd will take over in the midst of a turnaround at Burberry, with Gobbetti’s plan to elevate the label’s image showing progress but still incomplete. In the past, the fashion house was seen as a mid-market luxury brand, lacking the diversification of industry giant LVMH, whose products range from Louis Vuitton bags to Dom Perignon Champagne.
“We see the Jonathan Akeroyd as a solid CEO appointment,” said Luca Solca, an analyst at Sanford C. Bernstein. “It is important that Burberry appoints an executive with strong commercial and marketing skills.”
Burberry shares rose as much as 4.3% in London.
Akeroyd also held senior roles at the luxury department store Harrods in London. At Burberry, he’ll work with Italian designer Riccardo Tisci, who was brought in by Gobbetti from Givenchy.
Burberry will operate without a CEO in the first quarter of next year, since Gobbetti is stepping down on Dec. 31. Chairman Gerry Murphy will be in charge of the executive committee during that time, the company said.
Burberry had searched for a new CEO since announcing in June that Gobbetti would leave after more than four years running the brand.
Read More: Burberry Is “Very Confident” Riccardo Tisci To Stay On
Akeroyd, who ran Alexander McQueen from 2004 to 2016, led the brand through the turbulent period following the death of its eponymous founder in 2010, tapping Sarah Burton as creative director. The label got a public boost when Kate Middleton wore an Alexander McQueen dress for her wedding to Prince William the following year. Akeroyd also led an extensive store expansion.
“He did the groundwork that allowed Alexander McQueen to take off,” said Solca.
Akeroyd will receive an annual salary of 1.1 million pounds ($1.52 million) as well as a bonus and cash allowance. He is also getting a 6 million-pound award to compensate for shares and cash incentives at Versace.
Pricing Strategy
Burberry has been reducing discounts to better control its pricing strategy. It’s also making targeted investments with the opening of a new flagship store on Sloane Street in London in July, the same area where founder Thomas Burberry opened its first shop 130 years ago. Three more flagships are set to open -- in Shanghai and Paris as well as another one on London’s Bond Street.
During his tenure, Gobbetti purchased an Italian leather-goods maker to develop Burberry handbags. His successor may have to keep focusing on this category, which has weathered the pandemic better than ready-to-wear or some make-up products and is considered crucial for luxury groups such as LVMH or Hermes International. Burberry has been widening its bag offering with the launch this year of its Olympia leather bag, in a campaign featuring influencer Kendall Jenner.
Another focus will be investing in digital capabilities with more consumers shopping online, a trend that accelerated with lockdowns.
Akeroyd will also have to keep navigating ESG concerns, coming from investors but also consumers, worries that quite often can irk China, where a lot of luxury groups’ growth comes from.
Under Gobbetti, Burberry took the decision to stop the use of real fur and ended the practice of destroying unsaleable products, a move once done to preserve the scarcity of luxury products.
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