Another week, another story of woe with Marks and Spencer’s reporting a fall in sales and closure of up to 100 stores.
M&S has been in a tricky position for years as it is seen as a quintessentially British institution whose customers place higher expectation on it than almost any other retailer. Every few years a mini-crisis seems to arise. The great news for M&S is there is no shortage of opinions – the big job is deciding which voices to listen to.
So where is it going wrong for M&S? Looking at the customer feedback and social media comments it appears to be losing ground and customers due to the following reasons:
If you take a brief glance at the comments posted on M&S’s latest promoted advert, you’ll see images and names of products that customers miss and are no longer available. It’s possible that some of these past favourites weren’t commercially viable but could be a reason for customers choosing other retailers instead.
Automation of checkout s
Personally I don’t mind using a self-service checkout for a small shop and it’s a very common sight among most, if not all of the major supermarket chains. However the lack of “manned” tills seems to annoy the M&S regular.
“You’ve closed my local store” is a common cry as M&S has closed lots of smaller town centre stores in favour of out of town complexes. While the new formats appear to be more profitable they are clearly not successfully managing to move all their customers with them.
Confusing loyalty scheme
Just this week M&S boss Steve Rowe said the Sparks loyalty programme wasn’t firing on all cylinders. It was described as to discount focused but the key challenge was customers didn’t understand the whole points system behind it. On the plus side, the M&S Credit card has always been popular so will the firm buy some time.
Will M&S be the next to go?
So, is it all doom and gloom and should we be fearful of M&S being the latest big name to disappear from the high street? No! To the contrary, they have a habit of bouncing back.
M&S actually reported a 7.1% increase in pre-tax profits, generating over £126m in profits. Cost cutting was a large part of this which is clearly not sustainable but gives them some breathing room while they turnaround the business. Despite food sales dropping 2.2%, the overall online picture was healthier showing a 9.1% growth.
The key thing is going to be communication, not just what they say and do, but how well M&S listens to it’s customers. There’s a lot of goodwill for them, let’s hope they heed the warnings and turn things around soon.