M&S delivers – but is it too late?

Marks Spencer Leeds UKAuthor: John Wood, lecturer in Law, University of Central Lancashire

Over the last five years a revolution on the British high street has seen businesses and their customers wholeheartedly embrace online shopping.

Some companies seized the opportunity to branch out into often unfamiliar territory, while others failed to recognise how forcefully and quickly this market trend would blossom. When Marks and Spencer – the iconic socks-to-sausage rolls retailer – finally gets round to trialling food deliveries this autumn, it will find out if that particular lucrative ship has sailed.

M&S is playing catch-up with pretty much every one of its direct competitors in food retail. And the warnings are there for high street laggards. Now gone are places like Blockbuster video and Borders bookshops, which failed to adapt their business to the “sofa-surfers” whose shopping style was attuned to the advent of rivals such as Netflix and Amazon Prime.

It’s worth remembering that Netflix in 2000 proposed a partnership to Blockbuster CEO John Antioco and his team, only to be turned down. Choosing your moment can be crucial.

Ancient history. JLRPhotography/Shutterstock

Belly up

Whether or not a company survives depends on a number of factors, but mostly it concerns one key objective – can it remain profitable? What this often translates to is how well a company can maintain a market presence by offering a unique selling proposition – what marketing types like to call a USP. This can include offering the best price, best quality, market-leading service, widest choice, best guarantee or a market-leading product. In short, anything that distinguishes it (positively) from the main competition.

M&S has traded on its reputation for quality and a mixed offering, but with equally mixed results. Clothing has consistently struggled, while food has underpinned its performance. When trying to maintain a fine balance like that, the line between thriving and failing becomes a fine one.

Many in the past have offered a USP, and been much-loved by the public. Once-renowned companies such as BHS, Blockbuster, Borders, Comet, and Woolworths were all once market leaders in their respective fields, but eventually they all failed. They failed to remain relevant in their respective markets and often failed to embrace technology which would have allowed them to keep up with the competition.

Hitting the wall. Leo Reynolds/Flickr, CC BY-NC-SA

Staying alive

Survival involves much more than management making the right decisions, it often involves being ahead of the curve. We can see the effect of this dynamic in the UK high street right now. It is why M&S has had its place in the modern world questioned on a number of occasions.

M&S’ sustained issues with its clothing range have been masked by strength in food, which has made it all the more odd that the move into deliveries has taken so long, and seems so tentative, even now. At a time when retail space is no longer entirely essential, M&S is caught between closing some stores and opening new food-only stores as it tries to understand changing demand.

New benchmarks. Tony Baggett/Shutterstock

The warnings from retail experts are all about failing to latch on to market movements and trends, but M&S has seemed more worried about the risks of being the front runner. It is true that trends can quickly fade, but anyone watching Tesco, Asda, Ocado and Sainsbury’s vans rattling up and down our streets every day must have wondered what M&S was playing at.

Clicks are king for the moment, and for “bricks and mortar” retailers to thrive, they must develop a business structure that makes sense right now. If M&S wants an example to follow it could do worse than Ikea, which has worked to get rid of inefficient practices and established teams that collaborate across all channels, not just one, a tactic that may help M&S with the challenge of running its clothing offering alongside food and homewares.

Food deliveries are an effort to meet new customer demands, but M&S would do well to view its all of its operations from the position of the consumer – from the outside in – to develop an environment that actually enhances brand loyalty across all products. Apple’s product showrooms are world leaders in this respect.

M&S faces another testing year on the high street and on the internet. It no doubt hopes that a late foray into food deliveries will expose its business to more sofa-surfers and in turn help its ailing clothing division. But, a word of caution. Competition will be fierce, and if those previous company failures have taught us anything, it is that brand loyalty can vanish in the face of poorly handled strategy.

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