Burberry's Ahrendts makes a smart move to AppleOctober 15, 2013: 11:36 AM ET
Angela Ahrendts' new job as head of Apple retail is her first gig outside of fashion. Given the Burberry CEO's digital knowhow and Apple's move toward wearable technology, it's a natural fit.
The move looks to be a win for Apple and a loss for the once-stuffy British luxury retailer, which has transformed remarkably since Ahrendts took charge in 2006. Building on a turnaround set off by her predecessor Rose Marie Bravo, Ahrendts has expanded Burberry into a hip brand globally and has more than tripled the company's stock-market value to $11.3 billion.
Apple's $18.8 billion retail operation is six times the size of Burberry. And in her new job, Ahrendts will be contending with the challenges of rapid growth and how to keep it going. Samsung (SSNLF) and Microsoft (MSFT) have been encroaching on Apple's retail dominance. Meantime, Apple has struggled in China--a critical growth market where Burberry has scored big.
Apple CEO Tim Cook clearly recognizes that digital prowess has been critical to Burberry's success around the world. Ahrendts, a longtime Apple fan, has stocked the stores with iPad-clad salespeople and interactive mirrors, relied heavily on Facebook (FB) and Twitter to build customer loyalty, and overhauled the workforce by populating bringing in young talent. As she told Fortune's Stephanie Mehta at our Most Powerful Women London conference last year, 70% of Burberry employees are under age 30. Forty nationalities are represented in Burberry's London office alone.
Burberry has lured employees from Nokia (NOK) and Microsoft's Xbox division and adopted a digital approach to virtually everything it does, from fashion shows to employee communications. Salesforce.com (CRM) CEO Marc Benioff has helped Ahrendts navigate Silicon Valley, as well as evolve Burberry into a "social enterprise." She adopted Salesforce's Chatter platform--a kind of corporate version of Facebook--to facilitate communication throughout Burberry.
In moving to Apple next year, Ahrendts will come home to America. Born in 1960 in tiny New Palestine, Indiana, she's the daughter of an entrepreneur dad and a mom who was a model. Angela thought she might grow up to be a fashion designer. Instead, she ended up in corporate jobs at a string of fashion companies: Warnaco, Donna Karan, Henri Bendel, and then Liz Claiborne, where she built hip young brands like Lucky Jeans and Juicy Couture.
Ahrendts, a mother of three, is renowned for her tireless work ethic. Her former boss Donna Karan told Fortune: "Her dedication and passion are unsurpassed. She eats, drinks, and sleeps it." In a 2007 Fortune profile of Ahrendts, Karan recalled her almost giving birth to her first child in the office as she was prepping a 1995 collection. The company was working feverishly to fit Demi Moore for an ad campaign, and a very pregnant Ahrendts worked late into the night as her hands and feet started to swell. Her son was born the day after she finished.
Apple will be Ahrendts' first job outside the fashion world. Well, given where tech is moving--toward wearable technology and an Apple iWatch, perhaps?--she is sort of staying in fashion. For Ahrendts and for Apple, this fit makes sense. No. 15 on Fortune's just-released 2013 international Most Powerful Women list. Ahrendts will be contender for Fortune's U.S. MPW rankings next year.