Is M&S to blame for its own decline?

Marks and Spencer's clothing business has failed to shed its 90s granny pants image, but was that an impossible task?

by Adam Gale
Last Updated: 08 Nov 2016

Like Great Britain before it, Marks and Spencer has lost an empire and not yet found a role. The nearest it’s come has been the role of deposed king of the high street, a national treasure mired in decline.

Shackled by an unfortunate association with granny pants and fashions ten or twenty years in the grave, M&S’s clothing business has nearly halved in turnover since its mid 90s heyday. Its only salvation has been in food, which has more or less doubled revenues in the same period, albeit from a smaller base, to become its main business line.

Despite the success of food, every single boss Marks and Spencer has had since its decline began in the late 90s – Luc Vandevelde, Roger Holmes, Stuart Rose, Marc Bolland and now Steve Rowe – has put great effort into stopping the clothing rot, without meaningful success.

Is it a failure of management then, or were they facing an impossible task? MT plays devil’s advocate and presents both cases.

Don’t blame the bosses: M&S was always doomed

What goes up must come down. An immutable law of business, as well as physics. Marks and Spencer was in many ways a victim of its own success.

 An entire generation of consumers became attached to the M&S brand during the 80s and 90s. In and of itself, that’s a great thing. But it also almost guaranteed the same brand would be toxic to the next generation. What financially emancipated young person, after all, chooses to shop at the same store as their mother? Fashion won’t allow it.

This was only compounded by the fact that competition in clothing became much more intense, thanks in large measure to the rise of Zara and fast fashion.  

For years, pundits and analysts have called for M&S to reposition to capture younger consumers from its new rivals. But how, exactly, was it supposed to do that without alienating its existing clientele? Edgy, youthful ranges would never feel authentic while pleated floral skirts were on sale in the next aisle, and vice versa.

So while M&S did make changes, a full transformation was never really feasible: shareholders would not have accepted a radical strategy that jeopardised a solid (if gradually declining) revenue stream for the chance of winning a new one at some point in the future.

The most they'd have taken is what they actually got: smaller scale changes in style on the one hand, cost-cutting on the other.

Once M&S lost its clothing mojo, it therefore had little choice but to realign around food – which it has actually managed to do very well, despite the increase in competition from the likes of Waitrose on the one side and Pret on the other.

No excuses: M&S dropped the ball

That’s one way of looking at it. Here's another.

M&S had serious challenges. But isn’t the whole point of a great management team to get a firm through challenges just like that and still succeed? Surely that’s what the art of reinvention is all about.

John Lewis offers all the proof needed that a quality shop with a middle class clientele and a clothes and homes focus can succeed in the 21st century. It pitches at exactly the same market as M&S used to, and it hits the spot where M&S now misses.

That isn’t just because M&S has some sort of unique association with an older, fashion-obsolete generation. There’s something to be said for simple things like store layout. As John Ibbotson of retail consultancy Retail Vision put it, ‘who needs time travel when you can walk through an M&S and experience the 70s first hand?’

Even online, M&S was late to the party, where it’s now finding it hard to catch up: growth at m&s.com was only 0.3% over the last six months.

It’s still likely that M&S would have declined in clothes even without these handicaps. But even if that were the case, what was the firm’s vision for the future? To turn a large, struggling business into a small, struggling business isn’t much of a long term strategy.

The fundemantal weakness of M&S as a clothes store is that it doesn't know who its customer is. In today's day and age, it's no longer enough to try to be all things to all people. 

It’s hard perhaps to blame former CEO Bolland, who came from the food side rather than rag trade, for not finding out who that customer is. The same cannot be said for current CEO Rowe.

His decision to cut back on clothing space, ranges and stores in favour of food may be rational in the circumstances, but unless he wants to see M&S eventually retreat from clothes altogether, Rowe needs to figure out  who M&S is for and what it's going to be excellent at, aside from food, and then sell that to customers, staff and shareholders.

And if that's too hard, a nifty Christmas advert wouldn’t hurt either.

Which side do you agree with? Tweet to let us know.

Image credit: GianniM/Wikipedia

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