Positioning seeks to stabilize and retain the positions of the differentiated products for a particular Company so as to retain the competitive advantage of the Company in regard to those products (Ferrell & Hartline 2010). The positioning is based on Porters theory of five forces that shape business strategy. In reference to Marks and Spencer, it is essential for organisation before making use of best-in-class benchmarking to measure organisational performance by analysing internal as well as external competition. Retrieved from https://ivypanda.com/essays/marks-amp-spencer-companys-marketing-environment/. Worldwide in terms of profit it is considered as third leading retailer and in terms of revenue it is regarded to be the ninth leading retailer. Noticeably, M&S is competing in the tough market of home-use products, and also in the food selling in comparison to others food companies, where they are selling products from freshly produced groceries items and meals both partly and ready meal. M&S has to make plans for future recession and how to cope with recession if it happens again. Its main strategy is to sell goods and services of high quality at affordable prices. The objectives of the study is to advise the Board of Directors into a possibility to revisit and redesign the current business strategy based on the blue ocean strategy (Kim and Mauborgne, 2005) to provide value based innovation via cost reduction with increased value for buyers and to ensure sustainable business operation in Malaysia. On the Facebook pages, the Organization invites those who like their pages to give their views regarding the Organizations operations. Marks & Spencer as such then is challenged by this trend particularly from rival discount and supermarket competitors., Marks & Spencer: Competitive Advanteges and Future Stragegies. As a result, it becomes easy and convenient for the Organization to reach many customers with comprehensive information about their products and services (Harman 2014). Criteria for comparison Marks and Spencer Morrison Sales in the last five years (increment in amount) 10.300 billion 8.200 billio n Revenue of the company in last five years 481.7 million 389.8 million Presence in markets Marks and Spencer is present in various markets and it has 852 stores all over in UK. Methods of analysis include examining the following: the companys marketing strategy, the percentage of its market share in comparison to 6 competitors, its position in the market over 5 consecutive years, its marketing goals and predictions for the future, its survival during 2008-2009 recession, companys turnover over 4 consecutive years, the percentage of its turnover in terms of 6 competitors, expectations of the future of UK economy, and the firms predicted turnover for 2012 and 2013. Due to these circumstances, some recommendations for John Lewis are to take all or most of taxes on itself and be aware of new entrants. When customers are made to understand the unique characteristics of different products and services, they are able to make informed decisions regarding different products and services. -This school emphasis on analysis and calculation can be a very strong support to the strategy development process Within this intense competition of retail industry, Tesco can stand at market-leading position in recent years has mainly come from its strategies of expanding overseas, shifting to 'higher margin' non-food market and maintaining a strong core UK business (Corporate Watch UK, 2004). M&S targeting the customers of middle to upper class. Of these three processes, the people process is believed to be the most critical due to the ultimate need to involve humans in each step. Last accessed 16 May 2011., In this assignment, there will be a critical comparison of the UKs biggest retailers Tesco and Sainsburys, outlining their marketing strategy, the key factors of their success and also the advantages and disadvantages of both companies. Weakness of Marks & Spencer - Internal Strategic Factors . Now there is no doubt. Through the initiative, M&S has managed to outperform its competitors in household and food markets (Yudelson 2009). In terms of controlling, the management of Marks and Spencer has frequent reporting of expenditures with costs to provide a form of feedback. Marks and Spencer need to market their products well thats one thing they need, Internal analysis tools are used to identify and evaluate an organizations strengths and weaknesses in terms of its resources, operational capabilities and core competencies. In each part of the business M&S has a lot of competitors like BHS, NEXT, Burton and Gap. The UK clothing retail industry has experienced significant growth, which has focused attention on studies in the field with this sector being considered as the one of the most competitive markets in Europe. For example, a centralized training centre could be used to train store supervisors and section managers on sales. M&S needs to focus on the top end of the clothing market but deliver stylish cloths, beautifully made with fantastic value. Marks and Spencer is a major British multinational retailer headquartered in Westminster, London. It can be an integral part for improvement of organisation, however it is a fact that Marks and Spencer could not able to employ all the relevant strategies patented by competitors. M&S clothes are mostly for the people of 35-55 ages and ignoring the younger ages. Ten years later he was joined by Tom Spencer, and the partnership grew into the company known today as Marks & Spencer (Marks In Time n.d.). must. Over the last 12 months, it has taken measures aimed at boosting its position at the global level. M&S is using less packaging and less bags to save environment and natural resources. Economic situation of the country is the factor that can pressurise the M&S business. Based on the mission of the business the organizational strategies are put into words. IvyPanda. Changing store environment, design, fashion, food and change in lay out can attract more customers. Just like other multinational corporations, M&S was not exempt from the effects of the recession (Slideshare.net: Marks & Spencer strategic analysis 2015). Foremost companies must allocate funds for research and development, the conventional way is the percent of sales technique. The employee segments named above have specific needs and concerns as shown below: What M&S would want employees in this segment to know is that they need to humble themselves and work hard. This entails the study of how the company deals with change in the market, how it responds to the market demands. 2021. And the second target of M&S is the well paid job holders. Employees are selected not on the basis of friendship, but on merit and qualification. Marks and Spencer follow each and every primary business ethics of the business environment. Secondly, the experience curve and the Profit Impact of Market Strategies model which identified a number of strategic variables. Marks and Spencer is one of the most profitable companies in the United Kingdom and across the globe. In consideration to qualitative and quantitative aspects of strategic proposal it is evaluated that with new product and market Development Company can. At M&S you can shop around many things for your daily life use and life-style i.e. The primary focus of a cost leadership strategy is to achieve low costs relative to competitors. The company is employing approximately 80000 people in 2020. To compete based on cost, the company must address labour, materials, overheads, and other costs, and to design a system that lowers the cost per unit of the product or service. All these communication strands carry consistent brand messages such as: The key brand values include the following: All these values apply to the internal market as well as the external market. Larry Bossidy, former CEO or AlliedSignal, and Ram Charan, a business advisor to senior executives, describe three core processes of business which determine a companys overall ability to execute (Kinicki, 2013, p. 178). In other words, it should avoid operating at the extremes and embrace modesty. M&s needs to use the advanced technology to introduce its products more widely in the market like online shopping and fast delivery. Similarly, in the food section, although they have retained their market position, sales were less significant - this means that competitors are quickly catching up (Interim results presentation 2004)., The clothing retail industry has been and is undergoing significant changes resulting from processes of globalisation, changes in consumer demand as well as changing corporate activities in terms of strategic marketing decisions. In terms of controlling, the management of Marks and Spencer has frequent reporting of expenditures with costs to provide a form of feedback. On the side M&S has earned reputation in meeting the customer demand. M&S has placed itself in a strategic position to effectively compete with its rivals. Furthermore, competitive advantages model (Porter, 1985) which focus on five different forces in environment of organization, but suit with only stable market. Yudelson, J 2009, Sustainable retail development: new success strategies, Springer, New York. Disclaimer: This is an example of a student written essay.Click here for sample essays written by our professional writers. Looking for a flexible role? However, its main target is women who earn a high income. To serve such a high number of valued customers visiting 600 stores in the UK the company employs more than 75,000 staff worldwide (Company Overview | MarksandSpencer.com) . Marks and spencer 1. The main aim of marks and spencer is to maximize profit and become the worlds most sustainable major retailer by 2015. M&S markets products for both sexes. However, Marks and Spence assessed all of these aspects at the planning phase of new product line which ensured that organisation have feasibility to manage specific strategic changes effectively with respect to timing. Abroad, it sells goods and services in more than 320 stores in over 40 countries. External analysis tools such as Porters five forces gives a view of the immediate competitive environment to reveal market opportunities and threats. Introduction. M&S is growing in menswear and kids wear market rapidly. PESTEL analysis gives us an idea about the external environment of M&S. It has been analyzed that Marks and Spencer have been working in a highly competitive market where the degree of rivalry among competing firms is high because of the similar price and quality products produced by other retailers in the industry. student. Political, Social, Technological factors are favorable, while Environmental factors are neutral and Economic and Legal factors are slightly unfavorable At the same time, it is also essential for Marks and Spencer to determine the marketing and management capabilities needed to maintain the achieved market and competitive position. Bodnar, K & Cohen, J.L 2012, The B2B social media book: become a marketing superstar by generating leads with blogging, LinkedIn, Twitter, Facebook, e-mail, and more, Wiley, Hoboken, N.J. Business case studies: Using supplier relationships to serve customers better 2013, Web. Often, lowering costs requires additional investment in automated facilities, equipment and employees skill. M&S should operate home furniture business separate from food and clothing. After two years of growth, the food and fashion giant has been stopped in its tracks by a grim combination of economic factors, ranging from bad mortgages in the US to rising petrol prices and the mountainous personal debts of British shoppers., Marks & Spencer became the first British retailer to make a pre-tax profit of over 1 billion BBC News online 1998 Though a few years later Marks & Spencer were hit by the credit crunch which has had a dramatic effect on the company as they struggle in the current economical climate., References: Marks & Spencers Press Release, 2010. Spencer Marks has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network. Mark and Spencer mission statement as former times and still is 'Good quality for the penny' whereby the penny turned . This initiative was aimed at helping the Organization attain sustainable customer satisfaction (Smith & Cockburn 2013). 2021, ivypanda.com/essays/marks-amp-spencer-companys-marketing-environment/. professional specifically for you? Marks and Spencer should focus on developing economies throughout the world for expanding their business and gaining sustainable competitive advantage. Armstrong, G & Kotler, P 2009, Marketing. Under the 480m investment plan M&S is to open 12 new food halls in communities including Stockport, Barnsley and the seaside town of Largs in North Ayrshire, Scotland. Marks And Spencer Competitive Analysis. Iceland sell very cheap food as compare to M&S. For instance, their clothing range - especially womenswear - has suffered from lack of novelty. The whole idea behind differentiation is to create a market niche for that particular product or service. The objective of M&S has always been to transform itself into a leading player in the retail industry. The initiative has been praised for enabling M&S to achieve some milestones, especially increasing customer satisfaction. Women. Marks and Spencer (M&S) has a tough and competitive external environment. Marks and Spencer Group (M & S) is an iconic and leading retailer of food, home ware and clothing items in the UK and worldwide. Although M&S has very good quality of the clothes but on the other hand their clothes are very expensive and old fashioned. BCG matrix is the matrix which determines the level industry relative share of the industry and the business with the help of four dimensions. To carry out this report we have selected a company named TESCO which is a worldwide grocery and universal products dealer founded in the year 1919. Marks and Spencer Environmental Analysis SWOT Analysis Strengths M&S markets high quality and competitive products. Weakness are the areas where Marks & Spencer can improve upon. The renowned company was established in 1884 by the founding partners Thomas Spencer and Sir Michael Marks. M&S Quarterly and Annual Revenue Trailing 12-Months Trend (TTM) Annual Revenue $14.3B M&S's revenue is the ranked 3rd among it's top 10 competitors. For You For Only $13.90/page! Also, the forecast for the British economy does not always remain constant, leaving the future unknown., Talk of a consumer downturn has resonated about the City and government in recent weeks. Whereas, it is estimated that each week, the number of people who visit M&S is more than 21 million all around the UK (Company Overview | MarksandSpencer.com). The reason is that they enable Organizations to achieve their objectives. Iceland is the big player in food market and captured the big market in UK and emerging as a main rival for M&S. 4, no. Quality and care are at the heart of everything we do especially when it comes to making our products. -Particularly useful in early stage of strategy development, when date is analyzed Tesco was founded in 1919 by Jack Cohen who began his new venture by selling surplus groceries from a stall in the east end of London; One his first day he made 1 profit and 4 of sales (Tescoplc.com [history]). However, pre-eminent retailer the John Lewis Partnership ('the group'), with its partnership structure so unusual in retail, seems to be fitted with some kind of antigravity device. Strategic position: Marks and spencer is operating in a very competitive environment and there are many factors that affect the company in the outside environment. In November 2010 Marc Boland new chief Executive announced the next five years plans. The reason is that it has established a good rapport with all its suppliers, who supply it with products at cheap prices (Business case studies: Using supplier relationships to serve customers better 2013). When a brand is advertised on Amazon.com, it is accessed by millions of people across the globe and as a result, Amazon.com is capable of strengthening its brand identity. This complacency reflected a disconnect between Marks and spencer and its consumers, putting the company at a disadvantage among its competitors and forced Marks and Spencer to redefine its brand and to its marketing strategies so that it made itself relevant among consumers once again.. Letter of Transmittal 22 July 2011 CEO Marks and Spencer London England Dear Sir, Per your request a . Marks & Spencer's An analysis on HRM 2. The initiative was designed to incorporate the customers in making decisions about product development. The above positioning statement does not fit with all the targeted audience. It depicts that for Marks and Spencer the proposed business strategies in reference to new product development must be scaled. The reason is that it makes them feel part and parcel of the Organization, which in turn increases their loyalty to the Organization. However, that does not mean that it has neglected the other segments such as low-income earners. For example, low-income earners are motivated by the following: On the other hand, the high-income earners, who consider themselves as the affluent are motivated by the following factors: The youth are motivated by the following factors: Currently, M&Ss focus is on women with high-income. 2, pp.185 196. The psychological aspect has to do with the mental interpretation of various products by customers in terms of what the products mean to them (Lunden 2012). It can be said that by means of organisations competitive strategy, it can achieve an upper hand in the business market over its rivals. The reason is that many people use their e-mail addresses to register with Twitter and Facebook. The main competitors of M&S are listed below: The main strength of these competitors is that they focus on trendy fashion. The management believes in collecting and assigning . They always take in to account of the legal issues of the business like customer and staff safety, selling alcohol and tobacco to young people. M&S can increase its growth through offering new kitchenware and bedding products. are all compete on price, quality, range, and service in order to strive for business success. April 26, 2021. https://ivypanda.com/essays/marks-amp-spencer-companys-marketing-environment/. Introduction of products is only possible with best marketing and advertising approaches. In each part of the business M&S has a lot of competitors like BHS, NEXT, Burton and Gap. M&S can achieve better competitive advantage through managing the people at work in other words utilising human resources. It simply means that M&S has positioned itself to attract all types of customers. The strategy has also enabled the Organization to constantly update its customers and stakeholders on its undertakings. Marks and Spencer (M&S) has a tough and competitive external environment. For this reason, these ranges cater to different needs of the customers. Increase in number of food stores is required with British and world flavours. It also has to do with the choice of colors for the products and how the products are packaged. New media technologies can be used for efficient delivery of new taste and fashion trends from factory to store displays, better communication with designers, producers and suppliers is very important for the company, Zara is one of the fast market changing competitors of M&S, it is important that M&S be ahead of any of its competitors while keeping its classic touch of style in some range of products. If we compare the prices with BHS or top shop we will find that BHS has lower prices than M&S. M&S attracts its customers by promoting its products on every occasion and event by hanging promotional offers posters, sign boards and confetti. Marks & Spencer is one of the UK's leading retailers with over 21 million people visiting their stores each week. A Marks & Spencer outlet at The Mall Athens. Specific needs of the management and senior management employees: What M&S would want these employees to know is that people do not only work for financial gains but also to serve the community. Do you have a 2:1 degree or higher? Marks and Spencer (M&S) is one of the top retailers chain in UK which claims to be the top womens wear and lingerie seller as well as better quality food seller. M&S has a responsibility to ensure our products are responsibly sourced and uphold ourGlobal Sourcing Principles. Focusing on all the market segments would also enable the organization to improve customer loyalty and its brands, which would be sustainable in the long-term (The telegraph: Analysis: Marks & Spencer making progress, but sales still falling 2014). These techniques show the strengths and weaknesses of the organization and as well as their opportunities and threats that are possible to the business in order to form an effective developed strategic plan during the process of operation. In order to achieve competitive advantage M&S needs to focus on the following steps: M&S is offering different kinds of products like food, clothing and furniture. Specific needs of the middle-level employees: What M&S would want the employees in this segment to know is that personal, professional, and career growth are based on the commitment to the set goals and objectives. They should also internalize the Organizations core values and embrace them at all times. The M&Ss market is broadly classified into two categories named below: M&Ss market segments are based on the following criteria, The market can further be segmented using the following criteria, In terms of income, the customers are further segmented using the following criteria. Advantages: M&S also enjoys a friendly social environment in all the countries where it operates. If business is running in loss then it is better to close that business. The Organizations positioning initiatives are likely to remain the same over the next 12 months. RECENT STRATEGIC DEVELOPMENT HISTORY 2.1 Background Marks and Spencer, commonly referred to as M&S was founded by Michael Marks who opened a penny bazaar at Leeds market stall in 1884. Read our latest Family Matters Index report here. The assessment and evaluation of cost data in the aspects of launching new product by Marks and Spencer is about gaining insights and learning ways for achieving the goals of organisation in most effective manner. M&S operates as a family of businesses, selling high-quality, great-value, own-brand products and services, alongside a carefully selected range of third-party brands. The management of the organisation has been assisting. Last year recession has played vital role in M&S downfall. Over the last 3 years, the marketing environment for M&S has had a mixture of fortunes and misfortunes. Our people bring our values to life. An introduction, Pearson Education Company, Prentice-Hall. M&S has been acknowledged as a legendary UK retailing organization and therefore they are exemplars of best practice in society. According to the Chief Executive, Mr. Marc Bolland, the Organizations focus over the last 3 years has been to strengthen its foundation by investing in areas that improve customer satisfaction. Big brands like NEXT, Gap, BHS and Burton are attacking M&S in clothing business. An in-depth SWOT analysis that assesses both the internal (strengths and weaknesses) and external (opportunities and threats) environment of the company is given. As a business thats been around since 1884, we know how important it is to look to the future. Within 10 years Michael Marks had at least 12 premises, his business skills took him to his friends in the search of potential business partner, he approached one of his friends Isaac Dewhirst, whose money had loaned towards his original costs at start up, refused his offer but referred Mark to Thomas Spencer who was working for Isaac as a senior cashier. Also there will be, analysing the two companies in terms of size and perception, in the sense of the growth of both companies over the years and perception on how the Tesco and Sainsburys are perceived by their customers and also themselves., Marks & Spencer have recognised that they havent responded quickly enough to consumers changing needs and preferences. (Murray, 2013) . The retailer said eight 'full-line' shops selling food, clothing and . Additionally, the analysis also includes the possibility of developing a global strategy for Giant. (2011). Copyright 2023 - IvyPanda is operated by, Continuing to use IvyPanda you agree to our, Marks & Spencer Companys Marketing Environment, HelpMe.com: Marks & Spencer strategic analysis, Amazon offers amazon pages for brands to customize with their own urls, and amazon posts for social media marketing, Airbus Company's Operations and Design Management, Supplier Organisation's Financial Performance, Marks & Spencer Company: Effective Specific Innovations, Marks & Spencer Company's Strategic Planning, Marks & Spencer Companys Service & Carbon Footprint, Marks & Spencer Company's Organizational Behavior Issues, Marks & Spencer Company's Carbon Management, Marks & Spencer Firm's Plan A on Carbon Emissions, How the Recent Economic Downturn Affected the Marks & Spencer Strategy, Honda Motor Company's Sustainable Management Future, Anytime Fitness vs. Jetts Firm's Business Model, Marks & Spencer Company's Strategic Analysis in 2015, India recorded the highest growth in terms of international sales, Gross margin for general merchandise decreased by 11% in the UK, The total gross margin in the UK decreased by 40% in 2013, Operating costs in the UK increased by 3.5%, Drop-in capital expenditure by 500million per annum, Significant improvement in the gross margin in general merchandise due to operational improvements which are currently underway, Significant improvement in free cash flow due to completion of the single-tier logistics network, Strength 1: The managers have the leeway to make business decisions based on the situations on the ground, Strength 2: Few centers of power in the Organizations structure, Strategy: 1 specializing in food products, clothing, home products, and other luxurious domestic products (, Strategy 2: To meet the needs of customers by providing them with high-quality products and services at affordable prices, Strategy 3: Quick procurement of business decisions, Strategy 4: Use of social media for marketing, Strategy 5: Regular review and change of business strategy, General merchandise- 41% of the UK market (, Availability of customized products and services, Availability of children-friendly services, Sensitivity to customers needs, concerns, and worries, Interactive customer care on social media, Integrated marketing communication campaigns, To make aspirational quality accessible to all, High-quality products and services at affordable prices, Taking care of the welfare of the less privileged, Doing market research to identify the gaps in sales, Understanding what the competitors are doing, which is not being done by M&S, Investing more resources in promotions and advertisements, Employing more designers at the clothing division.
