Table of Content:
2. Corporate Objectives'''''''''''''''4
3. Market Overview''''''''''''''..........5
4. Marketing Audit: Internal & External Audit''''''6
5. Marketing Objectives''''''''''''''..11
6. Promotional Programme'''''''''''''11
This particular project will consist of a market research and a planning project for the period of 12 months in the Retail Sector of Marks & Spencer Plc.
Being an independent firm, they operate worldwide from the United Kingdom. Their head office is based in London.
Product Type: Value Share: Rank:
Apparel and Footwear 6.5% 1
Womenswear 6.3% 1
Menswear 9.0% 1
Childrenswear 5.7% 4
Apparel Accessories 9.0% 2
Footwear 3.2% 4
The primary focus of the firm is retailing, which mainly manages General Merchandising & Packaged Food. They also have a Consumer Finance facility known as the 'M&S Bank', which offers services like current accounts, credit cards, foreign exchange, etc.
M&S outlets are located throughout the United Kingdom, which reaches to 90% of the country's population within a 30-minute radius.
General Merchandise of M&S consists mainly of Apparel and Footwear; Womenswear; Menswear; Childrenswear; Apparel Accessories and Footwear.
The following table provides existing company value according to Financial Year 2014-15. Also, the rankings provided give a rough idea of the firms' product positioning in the current market among competencies.
M&S being an operator of general merchandise, grocery convenience stores, and online/internet retail, shows that the firm has a vast business reach catering to a wider demographic.
The following table gives a summary of the Operational Indicator of 3 Financial Years comparatively:
Content: 2012-13 2013-14 2014-15
Net Sales GBP 8,709.1 M GBP 9,053.6 M GBP 9,3403.3M
Outlets 853 893 923
Sales area 1,128,100 sq. m 1,160,500 sq. m 1,175,500 sq. m
Sales of Grocery 21% 22% 22%
The firm is currently set to concentrate on developing its 'Simply Food' grocery retail sector, rather than its department stores that come under general merchandising. This is because; currently M&S are focusing on redeveloping their departmental stores rather than expanding their network.
Technology will play an important role in developing both, general merchandising and 'simply food' grocery stores.
Also, as Internet sales have provided a major boost to the company sales by a considerable margin compared to earlier years, their awareness shall be more predominant.
According to market positioning that prevail currently; M&S General Merchandising may be well positioned due to its provision of quality regardless of the price quoted. However, companies like 'Next', 'John Lewis', etc. provide a highly competitive landscape because of their high quality product provision to consumers at a comparatively cheaper or lower price quote.
The Grocery Convenience Stores are well positioned in a competitive market too, however the strength lies in its approach to consumers. By providing to 90% of United Kingdom's population, within a 30-minute radius. However, firms like LIDL, Morrisons and TESCO are able to provide quality products too, but at a considerably cheaper rate. This hampers a certain target demographic audience, to shift from their current local grocery store towards M&S. Although, M&S provides a comparatively superior range of goods and the fact that 'Simply Food' 24-hour stores provide at consumer's ease.
Thus, it can be said that Marks & Spencer Plc. does lie in a high competitive market. However, its brand name has already built its reputation over the years and is already loyally visited by the existing customers and will attract more quality attentive consumers. However, to attract a larger target audience and demographic it is essential to provide a flexible price quote as well.
Marks & Spencer Plc. offers a wide range of products and services including General Merchandising, Grocery Convenience Stores and M&S Banking Services.
General Merchandising consists mainly of goods with current company value shares as follows: Apparel and Footwear (6.5%); Womenswear (6.3%); Menswear (9.0%); Childrenswear (5.7%); Apparel Accessories (9.0%); Footwear (3.2%).
As the Grocery Convenience Stores: M&S 'Simply Food' is currently performing comparatively better than its General Merchandising sector in Retailing; it is not essential for the company to issue redevelopment activities for the Grocery Sector. However, expansion plans in this sector will continue to take place and no expansion plans are to be taken for General Merchandising, as revamping this sector is a must.
Internet Retailing plays an important role in increasing sales for the firm. As, a significant proportion of sales come from this channel (approximately 8% during FY2013-14). Also, the company is now set to increase their incentives for customers to purchase products through the Internet.
Content: 2012 2013 2014
Net Sales: Retailing GBP 8,790.1 M GBP 9,053.6 M GBP 9,340.3 M
Net Sales: Internet Retailing GBP 517.2 M GBP 635.2 M GBP 763.0 M
Internet Retailing % share of total company Net Sales 5.9% 7.0% 8.2%
Although Marks and Spencer's may offer their goods at superior quality, their price quotes are relatively high, compared to those offered by other competencies in the current market.
The firm has a limited presence for branded goods of superior quality on their retail shelves being mainly restricted to 'Simply Food' only. As they had recently introduced branded products in Grocery Stores during the year of 2008. The company also keeps a limited range of branded electronics.
Even though they may offer a diverse private label line portfolio, for branded products. In General merchandising Sector, the firm doesn't seem to appeal the consumers any longer, as they are perceived as 'outdated'.
Their private label goods range from mid-priced to premium, mainly in apparel and grocery convenience store products. Although the company has a strong reputation for the superior quality of their Grocery Store goods which has led to a strengthening of customer loyalty.
M&S has been the largest mixed retailer within the United Kingdom during 2014. The firm has been enjoying their leading position maintained since years in both General Merchandise and Grocery Convenience Stores.
Content: 2012 2013 2014
Outlets 853 893 923
Sales Area 1,128,100 sq. m 1,160,500 sq. m 1,175,500 sq. m
Therefore, looking at the following increase in outlets and sales area over the years, it can be said that M&S are looking forward to increase their development in their number of outlets and area in order to target more consumers so as to make easily accessible General merchandise and Grocery Convenience Stores. However, currently they look to expand their grocery store accessibility to consumer rather than General Merchandising (GM). This is because GM requires redevelopment within its current sector due to a decline in sales.
As the company looks to revitalize its current brand image in the GM sector, certain promotional programmes like advertising, internet marketing and online sales discounts aim to provide customer benefits. Promotional strategies play an important role in marketing where the firm has started to take initiatives in fields such as developing in-store technologies, relevant advertisements, and conveyance of product awareness through social media platforms. Also, social media being an important role player, it tried to be used in a way to provide random kindness acts, which were to give incentives to consumers who interacted often via the social media platforms.
The firms strengths lie in its well known brand image/good-will, current rankings in mixed retailers groups, the 'Simply Food' sector to provide more than 90% of population easily accessible stores, world-wide network with a wide range and reach to a larger demographic audience.
The firm's main weaknesses can be assessed as follows:
' In such a competitive market, it enjoys its market positioning. However, the price spectrum coverage is leading consumers of few major demographics to shift to other brand names like 'John Lewis' and 'Next'.
' General Merchandising may have a wider price range within its apparel and footwear currently. However, its clothing line is limited to middle aged demographic at the moment.
' According to current price spectrum provided by the firm, it is certain that other brands look forward to build strategies against this particular aspect in order to increase their competencies over M&S.
The Firms main opportunities can be as noted follows:
' M&S look to increase their development in expanding their grocery store outlets, due to its customer loyalty.
' Whereas, the General Merchandise sector can look to increase their investments in e-commerce sales. However, improvements in clothing apparel could set a larger and wider demographic target audience.
' E-commerce distribution center developments can help improve online sales via on-time delivery services and more efficient delivery to consumers.
' Technology can play an important role to improve in-store experience as well as Internet retailing. For example: Introduction of tablets to assist customers, Browse and Order points to order products that are out of stock.
The main threats to M&S can be noted as:
' Competitive quality and price spectrum provision via other brands like 'John Lewis' and 'Next' can prove that certain consumer groups shift towards those brands.
' Limited price spectrum coverage could lead to limited target audience.
' Firms like LIDL, Morrisons and TESCO provide major competition to M&S 'Simply Food' in quality as well as price aspects.
Currently Taxations and laws seem to remain unchanged for the upcoming years as any high fluctuation in taxations will hamper the Net Sales of overall brands to an extent.
Additionally, the country's governance systems and taxation plans are static rather than dynamic with relation to their futuristic plans. The taxes and interest rates shall remain static.
However, changes in current company CEOs may lead to improvements in favor of the organizations current affairs. As, there is a change in CEO for M&S Plc., Mr. Marc Boland (current CEO) is planning to retire by the end of the Financial Year ending 2016. He will transfer his job to Mr. Steve Rowe, who has been with the firm since 25 years and has previously been in charge of the Grocery sector for almost 3 years. Currently, he is the Executive director of GM and has been a board member since 2012.
Consumer wants a wider range of options. M&S must target the youth category too instead of only targeting middle aged consumers. Consumers also look forward towards price comparison with other brands. And Consumer is seeking more variety.
E-commerce and Social Media will play important roles within technological aspects. Also, it is essential for in-store developments and food sector too. Technological advancements can be experimented with new ideas, planning tests in certain stores, can take place once or twice a year to make initiative plans.
Also, M&S look forward to their Corporate Social Responsibilities (CSR) via opening environmental-friendly stores.
The following diagram is an analysis of Porters 5 forces to understand the major forces acting upon the business.
Overview: As M&S looks to redevelop its GM sector, they will look forward to increasing investments in this sector to improve their product range in order to revitalize the company's brand image.
M&S's 'Simply Food' grocery stores outlets will be looking forward to expansion plans as their customer loyalty has strengthened on the lines of premium quality products. Therefore, there aren't any requirements currently for revamps in this sector.
Thus, M&S General Merchandising (GM) and Grocery Store outlets marketing objectives shall be as follows:
' Increase investments for redevelopment of GM, mainly to create ideas for developing interest via a wider and larger demographic (young to middle-aged demographic).
' Increase number of outlets to M&S 'Simply Food' Grocery stores in order to increase customer accessibility.
' Technological changes can help enhance the service efficiency and timeliness. For example: In-store experiences, Introduction of Tablets, Browse and Order points to order out-of-stock products.
' Increasing awareness of internet/online retailing by provisions of promotional offers to new or existing customers.
' As online accessibility is moreover youth oriented, it is important to redevelop the firm's GM sector in order to increase/develop interest towards the younger demographic, to increase online sales by a wider and larger consumer force.
As per GM is concerned, to increase sales the following steps can be useful:
1. Manufacture of goods for wider spectrum of targeted audiences.
2. Manufacture of goods with a wider price range of products.
3. Targeting younger demographics can enhance sales by a comparatively larger margin.
4. As there are consumers with varying wants and demands, it is important to understand how to cater to such a large demographic before starting to provide modified products for both the business as well as consumer's convenience.
Content: Low-Income Higher-Income
Demographics. Demand for quality products at a cheaper rate. Demand for quality products at a flexible rate.
Middle-age Demographics. Demand for quality products at a lower rate. Demand for quality products at a flexible rate.
Further, these two demographics may have the ability to spend/willingness to spend in relation with their income categories which is very important to understand to know which consumers to target towards which strategy.
Therefore, these demographic groups can be further classified into two categories: Consumers willing to spend more (flexibly); and consumers willing to spend more wisely.
Consumers willing to spend more flexibly can be targeted with a modified production strategy, which could be featuring a new system of customization of basic goods such as apparel, clothing and footwear, where consumers can have a say of their own in order to what changes they require to specific products.
For example: Customized T-shirt Printing, Customized Trouser Tailoring, Customized Tailoring in General Clothing.
Benefits of such modifications in production can be used as a strategy, as consumers wants and needs are starting to become complex, as well as M&S targeting a massive demographic audience at the moment. Thus, if the target audience that are willing to spend more flexibly are given a wider choice, with a few of their own decisions to make on creating changes/ modifications to their chosen goods, it can appeal to a larger audience in general.
Consumers are looking to spend more wisely can be given more relevant choices of clothing and apparel based on current market trends. This can happen by improving or implementing changes in current ideas of designers or head in charge of designs, by developing awareness of current market trends. Targeting the youth demographics is an important motive right now as they use majority of Internet services. Therefore it may help boost online as well as in-store sales by a considerable margin.
Each consumer is different from one another for example: consumer that knows what he is purchasing v/s consumer seeking something that is worth buying.
Therefore targeting a wider demographic can help enhance its sales enhance its sales operations for its overall retail strategies.
As per Grocery Stores of M&S 'Simply Food' are concerned,
To increase company sales it can be said that-
' They can increase range of price spectrum to a certain extent.
' Import/Manufacture quality goods for a lower income group as well, if willing to increase investments.
' As M&S 'Simply Food' already have a great coverage of 30-minute radius to majority of UK Consumers, they have a strong customer loyalty with existing customers and brand image.
' Therefore, they can afford to make certain technological advancements within the grocery store sector and develop more outlets within the UK as well as developing countries such as India, Pakistan, Sri Lanka, Zimbabwe, etc. Where probably 7Eleven Convenience Stores are not present or dominating this sector of the market.
Thus, the following report can be said to provide certain plans that may seem essential for change implementation with regards to the company's main objectives. These changes may not be perfect but if implemented correctly with cost structures and future planning, it can enhance the Sales, as concentration on larger demographics is a basic essential.
1. BBC (2016) Marks and Spencer chief executive Marc Bolland to quit. Available at: http://www.bbc.com/news/business-35249317
2. Marks & Spencer Plc. in Retailing (United Kingdom) April 2015, Market Research Provider, Euromonitor International.
3. Marks & Spencer Plc. in Apparel and Footwear (United Kingdom) April 2015, Market Research Provider, Euromonitor International. '
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