Marks & Spencer: Marketing Audit, Strategy and Segmentation Analysis

This report presents a comprehensive marketing audit of Marks & Spencer (M&S), evaluating its current performance, marketing strategy, and market position. The analysis includes a PESTLE analysis of the external environment and an internal assessment of M&S's strengths, weaknesses, opportunities, and threats. The report then assesses M&S's existing marketing strategies, including product, pricing, place, and promotion strategies. It proposes two sets of market segmentation criteria – demographic and behavioral segmentation – that M&S could effectively target. The report also incorporates market research based on Porter's Five Forces model to understand the competitive landscape and customer buying behavior. Finally, it provides a justification for the chosen marketing strategy, based on the findings from the audit and market research.

Knowledge and
understanding of
different areas of
marketing

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................4
Marketing audit of business current performance ......................................................................4
Evaluation of organisation current marketing strategy as well as position. ...............................6
Proposal of two sets of market segmentation used by company. ...............................................7
Market research of business. ......................................................................................................8
Buying behaviour of customers towards an organisation...........................................................9
Justification of chosen marketing strategy................................................................................10
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
In a business, knowledge and understanding customer needs is very important. All
businesses have extended thair knowledge whether it is regarding customer needs and wants or
the experienced staff. If a business wants to be successful then they must have the quality to
share their knowledge. Understanding customer needs as well as knowledge must not be applied
only by maultinational companies but it is also useful for low marketing firms. There are
different areas of marketing like market research, search engine marketing, content marketing,
direct marketing, video marketing, social media marketing and so on. Knowledge and
understanding of different areas of marketing includes a marketing audit which involve
understanding the market place, understanding customer base, understanding and knowing about
4P's of marketing, the sretangths, weaknesses, threats as well as opportunities and establishing
market strategy to be successful. The below report includes marketing audit based on current
performance, evaluation of marketing strategy, sets of market segmentation, market research. It
also includes buying behaviour of customers as well as justification of marketing strategy. The
below report is based on Mark and Spencer. It is a british multinational retailer which has
specialisation in clothing sector, home products as well as food products. It was founded in 1884
by Michael marks and Thomos spencer(Luque-Martínez, Faraoni and Doña-Toledo, 2019).
MAIN BODY
Marketing audit of business current performance .
Marketing audit refers to the analysis which is done in systematic way in context with the
business marketing environment which is both in the internal as well as external form. Marketing
audit is important for a business because it provides a reference point for all sort of marketing
activities and also provide certain portrays which helps in enhancing efficiency as well as
company performance. There are many components of marketing audit like task environment
audit, marketing strategy audit, macro environment audit, marketing function audit, marketing
productivity audit, marketing system audit, marketing organisation audit. The marketing audit
involve both internal analysis as well as external analysis. With reference to external analysis, it
involve PESTLE analysis. Pestle analysis includes political factor, economic factors, social
factors, technological factors, legal factors, environmental factors. The pestle analysis of Mark
and Spencer is explained as below:-

 Political factors:- In accordance with european committee decision, there was free flow
of trade among them as well as other countries in context with foreign trade regulations
which helps companies in importing their products. So, in case of Mark and Spencer their
competitiors were having an advantage of high cost structure because company faced
decreased costs because of fair trade policy and they faced an impact of Brexit which led
to implications on their company. Due to Brexit, old plan of actions used by company
was not accepted by company(Paschen,Kietzmann and Kietzmann, 2019). Economic factors:- Economic factors involve interest rates, inflation rates, economic
growth and so on. In case of Mark and Spencer, they focused on their strategy regarding
providing all good quality products to consumers but company also faced financial crisis
due to which they faced loss in demand for quality products because customers were not
having much income due to which they are not spending much on brand high quality
products. It also had crisis with small local retailers in context with pricing strategy and it
all happened because of Brexit. Social factors:- There are many changes in social trends which company also faces. The
company also had one focus that to expand its name around whole world. Consumer
purchasing decision is influenced by social, cultural and personal factors. The company
faced loss in their customers because most of people connected the brand with past but
company tackled it in an effective way by providing ready meals all over the world and is
now at the top position(Finch, Nadeau and O'Reilly, 2018).

 Technological factors:- Technology never remains same and due to changing technology
companies also have to use such latest technology. In case of Mark and Spencer they
established self checkout stores and also an e-commerce store which is considered very
effective. It increased their customers because it led to time saving as all products were
available on their website. Legal factors:- In every country legal rules and regulations are always changed after
sometime. Mark and Spencer was not successful in dealing with legislations because they
were not able to protect workers from exposure risk. Due to failure in following
legislations company was not able to remain at top position only. The company was also
affected by due to Brexit(De Mooij, 2018).
 Environmental factors:- Due to environmental issues company implemented the concept
of sustainable retail industry and focused on their process of production. They also
implemented a concept of green policy which was a positive effect on communities as
well as wellbeing of customers.
With reference to internal analysis, the company has its own strengths, weakness, opportunities
and threats and it is explained as below:- Strengths:- Mark and Spencer is a well experienced as well as recognised brand. It is one
of top retail brand in UK and has made big partnerships across the globe. It is considered
as the recognised brand because company always provided high quality products(Foltean,
2019). Weaknesses:- Mark and Spencer faced reduction in their sales as well as high cost
products. According to recent performance of company, they faced reduction in their
sales due to poor supply chain as well as products were not available due to which they
were not able to meet needs and wants of consumers which created a bad image in minds
of consumers. The company was always dependent on manual operations which involve
high cost and in comparison with other companies they were using old technology. Opportunities:- Company has many opportunities through which they can improve their
brand image like online sales, market segmentation. In context with online sales, they has
also an online store but is not able to achieve much as compared to Amazon. So, it is an
opportunity for company to improve their online sales as bring all kind of products online

also. In context with market segmentation, then the company also implements policy of
market segmentation and provided products according to demands of consumers.
 Threats:- Mark and Spencer has a threat in context with high competition. The retail
sector has many competitors like Next, Sainsbury, Amazon and so on. So, if company
doesn't change its schemes and different plans of action then it would not be able to
compete and remain at the top position(Chen and Lin, 2019).
According to current performance of company, the marketing audit reveals that there are difficult
market conditions which affected their performance and also involve Black friday promotion,
mild weather. Due to removal of black friday promotions there was decline of 25% in their sales.
According to recent report, in case of home products as well as home products they have started
their sales online also and according to its strategy they also has reduction in their costs which
was effective as well as efficient for them.
Evaluation of organisation current marketing strategy as well as position.
Mark and Spencer has achieved a good growth in accordance with their store addition.
According to the recent position of company, they has earned a revenue of around 10.2 billion
pounds which was mostly earned by its food products. The company also initiated online sales of
their food products. The company uses direct investment as well as franchising for international
markets. In context with current market position they also faced loss in their market share in
clothing products(Mooney and et.al,2018). The women clothing products ranges unfit by 21
points. It was also analysed that it UK sales reduced by 4.2 %. In context with current marketing
strategy of company, the product strategy which they follows is like they offer products for all
age groups whether men or women, they offer footware products also. As in the case of food
products as well as home products, they provided various products like furniture, lighting, gift
items and so on. As in the case of pricing strategy, they follows competitive pricing strategy due
to which many competitors were having an advantage and through this customer gets many
choices(Belk and et.al, 2018). The company also follows dynamic pricing strategy as it offers
discounts so that more customers can get attracted towards them. In place strategy, they ahs
about 1000 stores which are available in about 50 countries. The company also has their own
website through which customers buy products as well as have an option of home delivery. In
case of promotion strategy, they used the strategy of advertisements and doing digital marketing.

Through their own website, the company promotes their products and post fashion tips on their
website.
Proposal of two sets of market segmentation used by company.
Market segmentation means dividing all customers into small groups according to certain
features like income of consumers, their age, behaviour and so on. Market segmentation involves
demographic, geographic, psychographic as well as behavioural segmentation. The segmentation
used by Mark and Spencer is explained as below:- Demographic segmentation:- It is a type of market segmentation which is done
according to race, caste, age, gender, income. It helps the organisation in targeting
customers more effectively. In case of Mark and Spencer, their main target was to attract
young people but due to this segmentation, their strategy was considered wrong because
in context with clothing line it is not specific that only young people will wear such
dresses, it is possible that elder people too can wear such dresses. As they were
enhancing their strategy of online sales so demographic segmentation was successful for
them in context with gender because people behave totally different while purchasing
online whether they are men or women. With reference to income, they became
successful because they were offering good quality as well as high quality products
which people can afford to purchase(Giovanardi and Lucarelli, 2018).
 Behavioural segmentation:- It means to divide customers into different segments
according to their behaviour while doing interaction with business or through any
website. In case of Mark and Spencer, they have regular customers and they never stop
purchasing products from company as they are satisfied with the services as well as with
the company. Due to regular customers they always earned profits through which they
were able to collect more products. They also became successful due to brand loyalty.
As, their regular customers were having same attitude towards the brand. Behavioural
segmentation is also based on benefit sought which segments their audience according to
what customers wants from their product in context with feedback, usage, USPs and so
on. So, in case of Mark and Spencer, they were successful because customers were
getting all benefits from products as well as company was getting positive feedback from
customers(Lindgreen, and et.al, 2020).

Market research of business.
The market research of Mark and Spencer is based on Porter five forces model which is
used to identify all forces as well as analyses strenths and weaknesses of company. Porter five
forces model includes threat of new entrants, threat of substitute products, bargaining power of
buyers, bargaining power of suppliers and rivalry among competitors. Threat of new entrants:- For a business, new entrants becomes a threat for organisations
which affects them in a negative way as their profits gets affected as well as increase their
competitors. As in the case of Mark and Spencer, they also faced new entrants in their
sector which led to low pricing strategy as well as decrease in costs but threat of new
entrants for company was low because of company popularity as well as high quality
products. Due to this it was not easy for new entrants to achieve success. The efficiency
of their products is difficult for competitors. Though they do not have much threat of new
entrants but company always provided high quality products and due to this new entrants
took advantage as they offered discounts to all consumers. The company can handle the
threat of new entrants by innovating new products as well as spending money on research
as well as development of products(Fidel,Schlesinger and Emilo, 2018). Threat of substitutes:- In a retail sector, there are many substitute products which affects
existing organisations as consumers get other secondary choices of products too. So, in
case of Mark and Spencer they have high threat of substitute products because as in the
clothing business line, it is very easy for new entrants to copy all designs and sell it at
low cost. So, to tackle such threats the company need to innovate new products so that
they can keep their brand at top position. They were also facing threat in their food sector
also as there are other big brands also like Tesco who have same kind of products. To
tackle such threats company must understand needs and wants of consumers as well as
they should be service oriented. Bargaining power of suppliers:- The power of suppliers can be high if there are less
suppliers available in the market. So, in case of Mark and Spencer, supplier power was
low as there are many suppliers in the market and company is not dependent only on one
suuplier. Due to outsourcing of business, power of suppliers went low but there are some
conditions when less suppliers are there in the market which reduces profitability of
business so to tackle supplier power, they msut use different materials so that it becomes

easy for organisation that if prices gets high then they can focus on another
material(Tarsakoo and Charoensukmongkol, 2019). Bargaining power of buyers:- The power is in the hands of buyers if for an organisation
there are only few buyers and organisation has no choice and they had to depend on their
terms only. In case of Mark and Spencer, bargaining power of buyers is high. Due to this
they faced pressure by all customers regarding discounts, low pricing strategy. As there
are many competitors available in market offering same kind of products and at low cost
so customers can switch to any other product because they want good quality products at
low cost(Tronvoll, Barile and Caputo,2018).
 Rivalry among competitors:- In retail sector there are many competitors who have equal
power due to which companies face threat as customers gets many choices regarding
their purchase decision. In case of Mark and Spencer, there are many competitors which
affected their profitability. It was analysed that they started usage of loyalty membership
cards but their strategy can be used by any other competitor also. Due to this they started
focusing on low pricing strategy as compared to their competitors.
Buying behaviour of customers towards an organisation.
It is very important to maintain good relation with consumers. Customers expectations,
their needs, their demands never remain same. They are always changing and they want that
businesses understand about their demands and their likes and what they don't like. So in case of
Mark and Spencer, buying behaviour is positive towards the brand as they initiated reward
scheme and through this they maintained good relationship with all customers(Herhausen, and
et.al, 2020). The company is still at top position because they always focused on meeting
demands of consumers whether in the clothing line or in home, food products. Buying behaviour
depends on many factors like social factors, personal factors, psychological as well as cultural
factors. Mark and Spencer always received positive feedback from customers because they
provided high quality products. In context with clothing line they focused on all age groups as
well as enhance lifestyle. The attitude of consumers never remains same so company focused on
their changing attitude like in clothing products customers wants stylish clothes which Mark and
Spencer successfully did to customers and in case of food products, customers gives priority to
their health so company also focused on health of consumers. They also enhanced their multi

channel experiences like universal app, delivery proposition and so on which led to positive
buying behaviour .
Justification of chosen marketing strategy.
Mark and Spencer follows different marketing strategy through which they become
successful in comparison with their competitors as company follows different product strategies,
price strategy, place strategy as well as promotion strategy. On the basis of report it is analysed
that their product strategy, place strategy and promotion strategy is really successful because
company is offering various type of products dealing in many sectors as they were not focusing
only on specific people but targeted all type of people whether male or female, of any age
group(Morgan and et.al, 2019).Through these different strategies they became successful in
meeting needs as well as demands of consumers. As they chose two segmentation strategy that is
demographic segmentation as well as behavioural segmentation and through this their chosen
strategy became successful because consumer behaviour never changes in context with the
brand. They still have their regular customers purchasing products from them and based on
demographic segmentation they focused on all customers.
CONCLUSION
From the above analysis it is concluded that, in a business proper knowledge and
understanding of customer needs is necessary. While developing and enhancing any kind of
business, there are certain strategies which has to be made by businesses. When any organisation
enters the market, they become threat for other existing organisations because they come up with
latest technology and reduced cost products through which they attract all type of customers.
Businesses also sements their market on the basis of different segmentation strategies like
demographic segmentation, behavioural segmentation, psychographic segmentation and so on.
The consumer behaviour towards company products can change at any time. So, it is important
for businesses to focus on their changing demands.

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