Tailor made M&S stores

 

In order to elevate domestic sales to 1.5 billion pounds, Marks and Spencer believe the key is to customize their stores to the types of people who would shop in that area.

Marc Bolland disclosed that the M&S stores would feature products, suited to the likes of the nearby customer; meaning identical stores could be selling very different products.

A 30 person experiment in which customers had to find 5 featuring items in stock, found that only 8 of the 30 could complete the task in the 1 hour. So does Marks and Spencer need a change? Well Mr Bolland thinks so. He believes to make this turn around, clearer signage and better laid out stores will ensure this.

To administer this, newly appointed Neil Hyslop is the man for the job. Marc Bolland states ‘Customers told us our stores were not always easy to shop in and navigation is not that easy, and the sub-brands are not too clear when you walk in, particularly in general merchandise’.

During the autumn, the new project will be run out across the fleet of M&S stores. It will be set out in relation to wealth, target market, competitors on a small and large scale, and ethnic majority. Mr Bolland says ‘It sounds like jargon but it is extremely important for a retailer. Our stores have always been grouped by size’ however ‘we’re not doing rocket science here; we’re doing best practice good retailing’. In his eyes he believes before in M&S stores they updated stores by undertaking pretty basic redecorations.

Bolland ticks another box, concerning the fundamental modernisation of the company; continuing to filter out the original conception, of a broad church retailer.

Marks and Spencer declare modernising the company will help to reach their 1.5 billion pound target, across their British stores within three years. Mr Bolland believes this is the best way to prevent a conflict with principal supermarket chains. While Sainsbury’s and Tesco will be adding around 8 percent a year to their floor space in Britain, M&S only plan to add 3 percent. Bolland’s justification is that ‘If I was saying, it’s all do-able, all I need is 6 per cent extra space, that would be different. But we’re trying to do as much as we can from the same space. We’re not in the game of a space race in the UK’.

Marc added that considering the ‘challenging environment’ M&S has had a good year. Profits had risen to 13% before tax at £714million for the year to April 2^nd. Also the market share had risen 0.5% to 11.7%, and the company revenue up 3% to £9.7billion. The dividend had also risen by 3% only to 17p.

Mr Bolland says although a good April, we shouldn’t get ahead of ourselves as ‘April was a different month. We have seen that celebration is more important to the country and that with a combination of good weather and bank holidays, [especially] when close to pay day, we have good retail sales’. Furthermore ‘Consumer confidence is not going down. It’s going to be a difficult year on the consumer side but they know that. They know it’s going to be a year of more choices’.

‘We believe positive top-line momentum can be sustained despite the deteriorating outlook for consumer spending. M&S’s customer is the comfortably middle aged rather than the squeezed middle’ says retail analyst Katherine Wynne.

Shares in the company have unfortunately dipped from 397p to 390p.