Britain’s luxury fashion brand Burberry has received its biggest blow as it has become the latest fashion brand to dragged on the luxury brand market as its share price crashed to the lowest level since 1999 on Monday. Sustained volatility has been experienced in the stocks of this company and this has raised concern in the fashion industry and many analysts are challenging the strategy and positioning of this kind of firm.

A London based fashion label famous for its check pattern and trench coat, lost over 10 percent of its value in early trade and dipped to its lowest since 2009. This sharp decline is rather occurring while more and more people have started questioning the firm’s capabilities to stand against other luxury brands and sustain its superior positioning in the market.

There are risks that buyers and analysts have pointed out recently in Burberry’s operation, including the decreased growth rate in its major markets including China, and difficulties for Burberry to sustain its luxury image. The luxury sector has been problems over the world as the economic crisis along with shifts in customer preferences influence its sales. Nevertheless, compared to the others, the company’s decline seems to be sharper and that has triggered questions on the part of analysts on what the company’s strategy of the future will look like.

The first area that condition rises as a major problem in Burberry chain is the perceived issue of brand equity dilution. Some have said that the company’s quest to expand the market share was a direct shot at the firm’s ability to offer luxury cars. Another criticism is that brand has extended its range to more affordable SKUs and distribution channels, and stretched too far to maintain that it can continue to charge premium prices like a luxury brand.

Furthermore, it has been hard for Burberry to develop new products to sell and find effective ways of promoting them. However, despite attempts at revamping the company and its products, mainly under the appointment of Daniel Lee in 2022, it hasn’t affected the market share and the public perception of the brand positively.

This industry elate closely follows the economic conditions and markets sentiments, and Burberry’s poor results can be attributed to tendencies affecting the entire sector. However, rating of the company is lower than the average rating for the industry which can indicate that there are some problems specific to brands. There are some criticisms suggesting that inconsistent brand communication and product range could be some of the main reasons that Burberry is currently facing.

Regarding this sector, the COVID-19 pandemic still has its effects, especially on purchasing behavior and travel bans, thereby reducing sales, especially in travel destinations. Like every other luxury brand, Burberry has been experiencing pressure in cracking the nut and trying to perfect its online image and targeting the local consumers in some of these markets. However, the success of the respective measures has not yet been demonstrated.

While Burberry is facing these issues, the market followers continue to monitor the future actions of the company. Analysts have raised questions on the strategic plans of firms within the industry, whether they will pursue other organizational changes such as restructuring or even mergers and acquisitions. Thus it has been alleged that to recover the luxury status and the competitive advantage, Burberry may commence emphasizing its tradition and being British firm again.

The senior management of the company is under pressure to respond to such issues and outline proposals for the company. Market players are likely to be interested in knowing the specifics of the strategy for the regeneration of the brand, the turnaround of sales figures, and the reconquest of the image of a luxury house.

But still at the present times, this company is still considered one of the biggest giants of luxury sector with it breakthrough and established reputation. How this company will cope with this unfavorable period and become more successful during the period following it will not only be important for the future of the company, but will serve as an indicator for future success of the luxury industry as a whole in adverse circumstantial conditions.

Looking ahead the coming months will likely see Burberry’s voyage become something of a case study in both brand management and the workings of luxury markets. For the company to chart a course of growth, it will have to sustain its attempts of repositioning itself as a premier luxury designer.Adoptive strategies; The company’s thrust in the search for sustainable growth in the new world of designer luxury fashiongoods industry will be defining its growth path in the world of competition.