A Marketing Report on M&S - Assignment

You work in the marketing department of Marks & Spencer Head Office. The board of directors have asked you to undertake a marketing audit of the business’s current performance and have tasked you to undertake an evaluation of the organisations current marketing strategy and position in the market. The directors have asked that you include a proposal of two sets of market segmentation criteria which could be successfully targeted by the business. You must undertake suitable market research to explain how these chosen customer groups will grow the business within the retail marketplace. The report must clearly demonstrate your understanding of buyer behaviour and show suitable research to justify your chosen marketing strategy to meet the requirements of the suggested segments and move the business forward. The report must be fully Harvard referenced and make use of appendices material where appropriate.

Running head: A MARKETING REPORT ON M&S
A Proposal of Two New Sets of Market Segmentation Criteria for Marks & Spencer
Name of the student:
Name of the university:
Author note:

1A MARKETING REPORT ON M&S
Executive Summary
The report aims to analyze the efficiency of the product positioning strategy of Marks and
Spencer in respect to the current market situation in the United Kingdom. It finds that M&S
faces the sales drop year by year. As identified in the study, it is more because of its product
positioning strategy in stores. The segmentation of products is not done appropriately. Besides,
the positioning of the product does not appeal to the current trend. Hence, it was being
recommended that M&S should consider a strategic reset of product positioning to include more
fresh and healthy items in the food segment. Moreover, the use of bigger barcodes and faster
operations at stores was also recommended. All these can attract more baby boomers as they love
to shop in-store mostly. Website optimization was recommended to make it suitable for
generating mobile traffic. Notably, investing more in mobile commerce can help attract the
millennials, the other recommended customer group other than baby boomers.

2A MARKETING REPORT ON M&S
Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY:.................................................................................................................................4
1. Introducing the purpose of section..........................................................................................4
2. A marketing audit of the business’s current performance.......................................................4
3. An evaluation of the organizations current marketing strategy and position in the market....5
4. Two sets of market segmentation..........................................................................................10
4.1 An explanation of how these chosen customer groups will grow the business within the
retail marketplace...................................................................................................................12
4.2 The selected marketing strategy......................................................................................13
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................15

3A MARKETING REPORT ON M&S
INTRODUCTION
Marks and Spencer offer many products to consumers such as clothing, cosmetics, luxury
goods and household items. The company has used its experience over recent years to good
effect and nurtured its skills perfectly in the food segment. Since 2010, they have regularly added
more to their worldwide revenue. The revenue stood at almost 10.4 billion British pounds in
2019 (Statista.com 2020). Notably, the food segment of its business has contributed the most to
the revenue. The company has also shown significant progress in terms of its performance for the
online platform. Marks and Spencer online have accounted for an increase in revenue by around
370 million British pounds since the year 2011 (Statista.com 2020). However, the growth figures
for its online sales affected the footfall at Marks and Spencer stores.
Having been the reputed UK retailer for years it has faced its tough times over more than
the last 10 years. The clothing segment seems to be at the most difficult. Clothing along with
food makes up for a foundation stone for Marks and Spencer business (Retail-week.com 2020).
It has suffered a heavy blow to profits because of the closing of stores and restructuring of
programs (Ft.com 2020). All these have raised the urgency to decide between clothes and food
(Independent.co.uk 2020). If clothes are going through their tough faces, the time perhaps has
come for a focus shift towards food. Notably, many of the M&S stores are getting close. M&S
has planned a big shift towards its selling the foods. Moreover, it now wants to start home
delivery from 2020 onwards (Bbc.com 2020).
The report aims to conduct a Marketing Audit for Marks and Spencer. The findings of
the audit could help propose two new segmentation criteria for its food business.

4A MARKETING REPORT ON M&S
MAIN BODY:
1. Introducing the purpose of the section
The purpose is to do a marketing audit of the current business performance and
marketing strategy of Marks and Spencer. The findings of the analysis will be made the basis for
identifying the two most potential market segments for the food business of M&S.
2. A marketing audit of the business’s current performance
Marks and Spencer have struggled noticeably in the last 10 or more years particularly in
the clothing segment of the business. The performance is falling with passing years, the impact
of which can be noticed on the overall sales and revenue figures for the company. Many stores
are getting closed down. Like-for-like sales, which help to make up for the impact of new stores
or revival of existing stores have been showing a decreasing trend. Like-for-like sales have fallen
by 2.9% for the entire M&S group as a whole (Bbc.com 2020). Clothing and home sales
accounted for a decline of 1.6%. Besides, total sales had dropped by 3.6% mostly due to the
closures of stores (Bbc.com 2020).
The current restructuring program of Marks and Spencer just shows they have sensed the
threat of continuing the same way as they did for decades. It is due to this fact M&S is onto a big
shift towards food. Additionally, there will be an increased focus on expanding its online
capabilities using home delivery to start from 2020 (Bbc.com 2020). The strategy for a focus
shift should not just help the business in putting a larger focus on the most productive product
line but also there will be benefits for the entire organization. M&S has been a recognized and

5A MARKETING REPORT ON M&S
reputed name in the UK retail sector for years. It should be able to deal with the problems to be
faced while going for a restructuring of stores.
There will be significant roles to play for the HR personnel in the company. They will
need to take responsibility for sorting out any conflict between the employer and its employees,
which is pretty expected during a transition phase. There will be problems in training people on
soft skills that include creativity, problem-solving ability, etc. Soft skills will be crucial for
letting consumers feel the change in service delivery and the product line. People should know
why clothes will not remain a major part of M&S. There should be aware of what changes were
being made to offer the best quality foods.
3. An evaluation of the organizations current marketing strategy and position in the
market
The section assesses the marketing strategy and positioning capabilities of M&S. The
findings should help to know whether there is any need to consider a strategic reset of market
segmentation criteria.
SWOT analysis
Strengths:
Offering high-quality products at a large scale has been the essence of the performance
for Marks and Spencer. A variety of clothing items and fresh food have always been part of
M&S stores. They have a variety of foods for both vegetarian and non-vegetarian people. They

6A MARKETING REPORT ON M&S
work seriously on improving the shopping experience at stores. Moreover, the service is not just
limited to the range of clothes and food but also a noticeable after sell service to their customers
(Corporate.marksandspencer.com 2020). However, things have not moved well in recent times
for its clothing segment. It can be due to the fierce competition from fashion giants ‘Primark’
and online giants ‘Asos’. The sales have been historically low for M&S. There can be many
other reasons for this performance fall such as lack of stock for clothes in all sizes, and the
tendency to move slowly with the restocking of fast-selling and popular items in its countrywide
stores (Ft.com 2020).
Weaknesses:
Marks and Spencer have been facing problems at the front of clothing items. There is
an evident problem in the clothing segmentation part. Reports suggest that Marks and Spencer
have struggled to produce valuable business for its younger generation. As per a few reports,
there is a lack of clothing segmentation in M&S retail shops. They seem to have been reliant
mostly over cheaper offers; however, its customers appear to have low interest in price (Bbc.com
2020). Offering cheaper clothes is not an appropriate way of dealing with consumer demand.
M&S should listen to its customers to respond to their demands appropriately. There should be a
prompt response to changing consumer demand.
Opportunities:
The use of online shopping has made life easier for those who find less time to visit a
store. Marks and Spencer have shown good progress with their online sales. However, according

7A MARKETING REPORT ON M&S
to a few reports, the growing online sales for M&S is also a reason why the numbers for people
turning to its physical stores are falling. In spite of this, M&S would have to consolidate its food
segment, while also strengthening its online prowess. The online platform should be made more
relevant to the new digital age and efficient in providing a secure money transaction for
customers.
About the rising necessities as mentioned above, the Ocado deal could provide an answer
to that. M&S would use this deal to strengthen its capabilities in providing a home delivery
option to customers (Bbc.com 2020). Notably, M&S has agreed to buy 50% of the retail business
of Ocado for £750m (Bbc.com 2020). M&S would be amounting for an overall 25% reduction in
net home and clothing space as it tries to restructure or modernize its business to become
relevant to the current market landscape. One of the most notable of the announcements made in
recent times has been the plan to open around 75 new food stores. Currently, there are a dozen
sites where people can buy the intensive range of M&S Food. The food product line is very giant
as M&S offers close to 7,000 food products. The plan to open new stores can mean either closure
or relocation of 25 smaller Simply Food Stores as part of the restructuring process (Bbc.com
2020).
Threats:
The retail sector in the United Kingdom is hugely competitive for both new entrants and
the existing giant players of the industry. Marks and Spencer have been the leading UK retailer
for many years; however, the performance was affected largely in the last decade or so. It
receives huge competition from fashion giants ‘Primark’ and online leading player ‘Asos’.

8A MARKETING REPORT ON M&S
Besides, it itself is into problems for not being able to meet appropriately the clothing demand of
its customers in the younger generation group (Bbc.com 2020). Marks and Spencer receive huge
competition from Primark, Zara, Tesco and Wal-Mart. M&S has been tested for its capability to
satisfy the demand of consumers that change very frequently. The falling sales figures, as shown
above, indicate that M&S have misread their target market. They were focused mostly on
offering cheaper clothing; however, this is not the thing their customers were looking for. There
is a need to change now as it has been more than 10 years in a row with falling sales in the
clothing segment of the product line (Retail-week.com 2020).
Consumer Behaviour is Hugely Complicated
A UK survey of grocery shoppers has produced some eye-catching results. The
“Millennial” people in the United Kingdom said they mostly seek healthier food options. At the
same time, they want to purchase food from someone that reveals their back-end processes to
their customers. It means practicing a transparent supply chain is the growing demand for
modern consumers. It is because they want their brand to act responsibly towards its social and
environmental duties. Besides, millennials also look to discounted and better deals, which is
understandable as they are less wealthy compared to their parents. Finally, millennials strongly
prefer to buy from online platforms, which provide a seamless and convenient shopping
experience (Mckinsey.com 2020). It is, therefore, a difficult situation for the grocers or food
sellers to meet all these expectations while ensuring that the price remains attractive as well.
“Baby Boomers” too show a considerable buying capacity. They are a big customer base
for Marks and Spencer. However, this customer group presents excessive challenges for the

9A MARKETING REPORT ON M&S
company. Baby boomers are quite different from their elder generations. Some of the baby
boomers are to retire later in life. Many of the baby boomers are single. There are many also who
are pretty comfortable with using technology. This customer group is more focused on health
and wellness activities and thus they prefer shopping form stores in considerable cases. Baby
boomers like to use new products and services. They prefer products especially those that match
up with their life stage (Mckinsey.com 2020). Marks and Spencer should develop more
capabilities in obtaining better customer insights as this should help in fulfilling the diverse
product and service preferences of baby boomers.
There are a few commonalities between “Millennials” and “Baby Boomers” in terms
of behavioral change. The behavior to talk about poses a great challenge to food retailers. It is
the tendency of both these customer groups to not cooking at home. A huge population of
Millennials and Baby Boomers say they rarely have any desire for cooking at homes. Instead,
they prefer buying ready-made meals in noticeable cases. Foodservice is growing at a faster pace
in the United Kingdom. It is likely to continue the same way or even faster than the current. On
the other hand, the rate of food consumption at home is also declining quickly. In the future, the
revenues generated from selling ready-made foods are likely to exceed those at home-sales
(Mckinsey.com 2020).
The findings of the “SWOT Analysis of the Marketing and Positioning Strategies of
M&S” and the “Changing Consumer Behaviour in the United Kingdom” reveal a few
interesting things. These are:
 Marks and Spencer need to show good improvement in terms of its Online Channel. The
shopping should be made more secure and user-friendly for the customer;

10A MARKETING REPORT ON M&S
 There is a need to give more focus on its food segment as it also preferring a focus shift
to the food business. It must, therefore, obtain more insights into Millennials and Baby
Boomer customer groups. The findings suggest that there are huge differences in
opinions for foods and clothes between these groups. However, they all are at the same
platform in terms of opting for a ready-made meal;
 The need to have better customer insights is growing and thus should be taken seriously
by the company.
4. Two sets of market segmentation
Based on the points of findings as shown above in the bullets, ‘Demographic’ and
‘Behavioural’ segmentation require a strategic reset from Marks and Spencer. These
segmentation criteria should be used as long as the company is into the restructuring process.
They can show the spoken changes both on the floor as well as on its internet channel.
Demographic Segmentation:
Demographically, the target market will specifically be the Millennials and Baby
Boomers. Since there is an increased focus shift in millennials towards healthy eating the
selection for foods to be sold should be done aiming at this growing demand. Considering this
growing trend it should be a good decision to sell organic and natural foods to these customers.
Snacks particularly well made from healthy ingredients such as gluten-free snacks can be a good
nutritional choice for food lovers. Many other ingredients can be used to make healthy snacks.
The list of ingredients includes gluten-free, whole grain and zero trans-fat raw food materials

11A MARKETING REPORT ON M&S
(Whalen et al. 2018). By using these materials M&S can skip the legal hurdles for food check.
Notably, food companies have to abide by the laws of the Food Safety Act 1990 that provides a
framework for food legislation in the United Kingdom. The law will be considered to have been
violated if the standard measures for the safety, quality and labeling of food are not met
(Legislation.gov.uk 2020).
Some other food types can also be stocked to fulfill the food needs of diverse customer
groups. This includes but not limited to frozen meat and poultry, dried fruits, nuts in the shell,
frozen vegetables, oats, honey and much more.
Behavioral Segmentation:
As identified in the study, millennials prefer shopping from online channels in a
considerable amount of cases. It is because they find it time-saving and easy to shop platform.
Baby Boomers despite having a good interest in technology prefer shopping from stores. It is
because shopping this way involves a bit of walking in the shop premise and thus a good way to
give their body a bit of physical exercise.
Marks and Spencer should focus more on enriching the shopping experience for
people at its stores. It can do this numerously. First, it should invest in training staff on soft
skills. The use of soft skills could be useful in interacting more politely with store visitors.
Nevertheless, consumers will feel valued from such a gesture. Second, the layout design and the
use of technology should be there to speed up the buying process for the customer. The customer
would love if they can clear things faster at the cash-counters. Third, the use of bigger bar codes
in most places of a product will save time generally consumed in detecting the bar codes (Shikha

12A MARKETING REPORT ON M&S
et al. 2017). Fourth, Marks and Spencer should learn to follow the footsteps of the Coles
supermarket in Australia. Coles now runs the "Quiet Hour” program in most of its stores. The
program is for those Mums who have missed opportunities, which they had shopping with their
children but actually could not. It is because their children were different from normal kids. They
were autistic. Quiet Hour program means dimming the lighting system inside the shopping
premise, lowering down the volumes of radio, register and more. The purpose was to reduce the
sensitivity level of the shop floor and make it more suitable for autistic people (Coles.com.au
2020).
The online platform needs a strategic revisit to make it more meaningful for
millennials. According to a report, mobile traffic now accounts for around 45% of all online
traffic. The concept of shopping through e-commerce channels has changed greatly. People do
not use their PCs or Desktops to shop online. They now use their mobile devices to shop from
different e-commerce channels. The huge rise of “Mobile Commerce” in recent times indicates
that mobile commerce is a growing business sector (Sun and Chi 2018). It is therefore
recommended to M&S to invest in catering to the needs of mobile shoppers. However, there will
be a need for optimizing the website to make it mobile-friendly. The contents should appear
clearly to the visitors. The website should be made interactive by allowing for automatic
adjustment to the size of the website screen to appear on mobile devices (Sun and Chi 2018).
4.1 An explanation of how these chosen customer groups will grow the business within the
retail marketplace

13A MARKETING REPORT ON M&S
‘Millennials’ mostly prefer to shop from online sites accessible from their PCs as well as
mobile devices. The UK e-commerce market is the world's third-largest in terms of sales it
accounts for. However, the online retail market is reaching its maturity. The growth rates have
kept falling in the recent decade (Statista.com 2020). Hence, Marks and Spencer will have to
compete for gaining more shares of the e-commerce market. Good thing is that mobile traffic is
constantly at boost, which indicates people do prefer mobile devices more than anything else for
shopping purposes. 45% of online traffic comes from mobile commerce (Statista.com 2020).
Hence, M&S should get a massive consumer base if it intends to sell its products to mobile
commerce users.
Many ‘Baby Boomers’ believe that shopping can be a good way to relax. The
convenience of shopping, which they look for should be offered at M&S stores. Baby boomers
do make knowledgeable decisions. They are confident shoppers as only a few of them rely on
their relatives and friends for deciding on a purchase. Around 84% of baby boomers prefer
shopping in-store. They do not roam around new stores in search of a new product (Chakraborty
and Balakrishnan 2017). Hence, these are some solid figures and facts that suggest a potential
business opportunity in offering the right mix of products in stores.
4.2 The selected marketing strategy
Marks and Spencer should look to increase their business valuation by identifying their
customers and the preferred market place. Hence, it is recommended to offer fresh and healthy
foods to the customer. Besides, there should be a good understanding of how to cater to the

14A MARKETING REPORT ON M&S
needs of baby boomers visiting its stores. Millennials can be sold products in huge numbers
through its official online sales channel and utilizing mobile commerce retailing.
CONCLUSION
Therefore, Marks and Spencer should focus more on segmenting foods based on
customer behaviors for foods and their demographics. Baby boomers should be offered fresh and
healthy foods at their existing as well as restructured stores. The shopping experience should be
made much more convenient by considering a few changes to the storewide operations. It can be
the positioning of bigger barcodes on products to make it easily detectable or else. The official
website of M&S for facilitating online sales should be optimized to make it suitable for mobile
commerce shoppers.

15A MARKETING REPORT ON M&S
REFERENCES
Bbc.com 2020. M&S sales and profits fall amid shake-up. [online] BBC News. Available at:
https://www.bbc.com/news/business-48362772 [Accessed 30 Jan. 2020].
Bbc.com 2020. Poor clothing sales see M&S's profits slide. [online] BBC News. Available at:
https://www.bbc.com/news/business-50313770 [Accessed 30 Jan. 2020].
Chakraborty, T. and Balakrishnan, J., 2017. Exploratory tendencies in consumer behaviour in
online buying across gen X, gen Y and baby boomers. International Journal of Value Chain
Management, 8(2), pp.135-150.
Coles.com.au 2020. Quiet Hour. [online] Coles.com.au. Available at:
https://www.coles.com.au/corporate-responsibility/community/quiethoursstorelocator [Accessed
30 Jan. 2020].
Corporate.marksandspencer.com 2020. [online] Corporate.marksandspencer.com. Available at:
https://corporate.marksandspencer.com/documents/msar-2019/full-annual-report.pdf [Accessed
30 Jan. 2020].
Ft.com 2020. Marks and Spencer profits hit by heavy costs of turnround | Financial Times.
[online] Ft.com. Available at: https://www.ft.com/content/6760502e-7bd0-11e9-81d2-
f785092ab560 [Accessed 30 Jan. 2020].
Independent.co.uk 2020. Marks And Spencer. [online] The Independent. Available at:
https://www.independent.co.uk/topic/MarksAndSpencer?CMP=ILC-refresh [Accessed 30 Jan.
2020].

16A MARKETING REPORT ON M&S
Legislation.gov.uk 2020. Food Safety Act 1990. [online] Legislation.gov.uk. Available at:
http://www.legislation.gov.uk/ukpga/1990/16/contents [Accessed 30 Jan. 2020].
Mckinsey.com 2020. Reviving grocery retail: Six imperatives. [online] McKinsey & Company.
Available at: https://www.mckinsey.com/industries/retail/our-insights/reviving-grocery-retail-
six-imperatives [Accessed 30 Jan. 2020].
Retail-week.com 2020. Marks & Spencer: latest news, analysis and trading updates. [online]
Retail Week. Available at: https://www.retail-week.com/companies/marks-and-spencer?
authent=1 [Accessed 30 Jan. 2020].
Shikha, S., Salafi, T., Cheng, J. and Zhang, Y., 2017. Versatile design and synthesis of nano-
barcodes. Chemical Society Reviews, 46(22), pp.7054-7093.
Statista.com 2020. Topic: E-commerce in the United Kingdom (UK). [online] www.statista.com.
Available at: https://www.statista.com/topics/2333/e-commerce-in-the-united-kingdom/
[Accessed 30 Jan. 2020].
Statista.com 2020. Topic: Marks and Spencer. [online] www.statista.com. Available at:
https://www.statista.com/topics/3707/marks-and-spencer/ [Accessed 30 Jan. 2020].
Sun, J. and Chi, T., 2018. Key factors influencing the adoption of apparel mobile commerce: an
empirical study of Chinese consumers. The Journal of The Textile Institute, 109(6), pp.785-797.
Whalen, R., Harrold, J., Child, S., Halford, J. and Boyland, E., 2018. The health halo trend in UK
television food advertising viewed by children: the rise of implicit and explicit health messaging
in the promotion of unhealthy foods. International journal of environmental research and public
health, 15(3), p.560.