In a surprise move, Britain's Burberry Group PLC on Tuesday appointed Angela Ahrendts, an executive vice president with Liz Claiborne Inc., to become the luxury label's chief executive next July.
Ahrendts, 45, will succeed a fellow American, Rose Marie Bravo, who will leave Burberry's top job for a reduced role as vice chairman at the company.
Ahrendts said she already owns Burberry clothes -- mostly classic black suits and white shirts. But in the future, she must manage the British brand's continuing push into high fashion, complete with catwalk shows, flagship stores and garments like metallic skirts, knit berets and sequin dresses.
Ahrendts said her experience at Liz Claiborne, where she oversees brands such as Ellen Tracy and Juicy Couture, and jobs with retailer Henri Bendel and fashion house Donna Karan have prepared her for the task.
"As a company, Liz Claiborne has gone through a phenomenal growth phase and strong operating-margin increase," she said in an interview Tuesday. "I am very familiar with driving a global brand."
Bravo, who will take on the newly created role of vice chairman next summer, led Burberry's transformation from a dowdy apparel maker into a fashion powerhouse. The new CEO will have to sustain the brand's growth momentum of recent years.
The British retail and financial services conglomerate GUS PLC, which owns a 66 percent stake in Burberry, is planning to break itself up, starting with the de-merger of its Burberry stake in December. So while Bravo had essentially one majority shareholder to answer to, Ahrendts will run a fully public company with many shareholders.
During her 20-year rise in the fashion business, Ahrendts never took a sick day -- except, she said, a half-day for morning sickness during one of her pregnancies. Now a mother of three children, ages 5, 9 and 10, she runs 22 of Liz Claiborne's womenswear and menswear brands, which account for about 40 percent of the company's total revenue. In her seven years at the company, the corporation has grown to 41 brands from 10 and sales have increased to $4.6 billion from $2.5 billion.
At Liz Claiborne, Ahrendts is best known for furthering the company's acquisition of what it calls "modern brands." Those acquisitions include the jeans label Lucky, the youthful Laundry by Shelli Segal brand and Los Angeles-based Juicy Couture, which is known for its velour tracksuits and a celebrity following.
"She has been able to retain old customers while attracting new customers. That's exactly what Burberry needs to do, as well," says Marshal Cohen, co-president and senior analyst at NPD Fashionworld.
"The appointment of Angela Ahrendts brings diverse industry experience, strong leadership skills, strategic vision and strong brand management to the chief executive position," said Burberry Chairman John Peace in a statement Tuesday.
Ahrendts, who will join Burberry in January initially as an executive director, said she wants to explore Burberry's untapped growth potential and understand the current management's vision for the company. She wants to continue Burberry's expansion into new growth markets such as Brazil, Russia, India and China. She also plans to boost the brand's efforts to strengthen its accessories business.
So far, apparel accounts for 61 percent of total sales, but, like many fashion houses, Burberry is hoping for a bigger share of the fast-growing, high-margin accessories market. In that market, analysts note, Ahrendts so far has scant experience.
Internally, Burberry is in the middle of a major overhaul of its logistics and computer systems. Ahrendts also will have to contend with the brand's different images in some parts of the world. In Spain and Japan, two of its major markets, Burberry's positioning is less upscale than in Britain or the United States. For now, the newcomer has no plans to repeat Liz Claiborne's acquisition spree at Burberry.
"Burberry has a lot of organic growth potential left," she says. "But you should never say never."