Introduction
Marks & Spencer is a successful international group of clothing retailer, food, homeware and financial services company. Its excellent marketing strategy turned it into a billion dollar international group in terms of annual sales. However, the emergence of a more competitive market leads to slow growth, which required a reconsideration of their business strategy. The system that once worked for the international company has become its liability with the occurrence of market decline sometime in 1998. They later found that buying for two seasons of the year and phase buying for the rest of the season was no longer advantageous as their competitors took advantage of the different seasons to get to the core customers. The downturn resulted in the restructuring of its supply chain and adoption of market segmentation which proved to be more efficient and effective in delivering its product to the target customers.
The eventual recovery of Marks and Spencer can be attributed to the adoption of diverse strategies. For instance, before the year 2000, there was a complex and long supply chain that proved to contribute to added cost and inefficiency. A thorough review of the supply chain resulted in the elimination of duplicate processes and promote transparency; accordingly, this was achieved by engaging with fewer suppliers. The strategy resulted in a huge savings as it became more efficient for M&S to transport the goods to the stores, and eventually respond to customer demands in a timely manner. The short lead time is helpful in identifying trends in fashion, contact supplier, production and the introduction to the market. The example set by M&S showed that supply chain management is a valuable tool in securing competitive advantage for better organizational performance (Li et al, 2004).
Market segmentation “refers to selecting one or more market segments which the organization can target through the development of specific marketing mixes that adapt to particular market needs.” (Goyat, 2011). It is the purpose of market segmentation to target a wide range of markets by dividing them into groups with different needs and wants. With the use of segmentation, marketers will have a better understanding of the characteristics of the target customers, thus they can implement a more efficient marketing strategy (Larsen, 2010). There is a need for a well coordinated supply chain to bring more value to the customer (Anderson et al, n.d). In the case of M&S, the line of clothing was strategically segmented to allow the customers to have a wide array of selection.
The perfect and classic collection is meant to offer a range of seasonal clothes that are classic and stylish. This range of clothing line is intended to meet the demands of its key customers. The merchandise includes 60 different lines of clothing that cater to both men and women. While the items are stylish, they intended for a group of customers that want their apparel to be just a ‘return to basics’. This clothings include plain, white shirts, black-neck sweaters and jeans. Moreover, they are aimed at customers who tend to have a busy lifestyle and are looking to get quality and value at a reasonable price. These lines of clothings are therefore designed in a way that they are machine washable, non-iron and tumble-dryer friendly. In the brochure, the garments are described as timeless essentials that one can pair with just about any other apparel. Consequently, the practicability of these collections matches the customer who have a more mature sense of fashion, thus the advertising focused more on the design, comfort, durability and versatility. These ranges of collection are deemed appropriate for working mother who wanted to appear classy, minus the hassle of having to elaborate fashion. As claimed in the brochure, ‘Every piece in the Classic collection is designed to skim and flatter the natural body shape, whatever your size.’ These are apparels that are smart and elegant and are made of high quality materials.
When Marks & Spencer launched the autograph range in the summer of 2000, it was their intention to cater to a wider audience. There is therefore a need to introduce more sophisticated and complex design for this range. It caters to people who were usually exposed in a unique environment, and the company has to expend effort to attract a large number of customer base. Top designers such as Julien Macdonal, Philip Tracy and Sonja Nuttal were involved in the creation of women’s wear, menswear and other accessory collections. This category had manager Liz Alcock, state: “The Autorgraph philosophy is to bring cutting-edge design to a wider audience within a unique environment”. Accordingly, The Autograph label, was made available in selected stores only and it was introduced in the market in the summer of 2000. For instance, the hat collection designed by Philip Treacy’s was launched in 2001, in 15 M&S Autograph boutiques countrywide. The collection consisted of 18 hats and 10 bags with no more than 60 of each colorway and styles. It is the goal of M&S to bring top designer collections to its customer base at high street prices, within a designer boutique environment through the Autograph range.
The per una range, which was launched in the market in 2001 was intended to target customers aged 25 to 35 years old, although the high quality line was intended to appeal to a wide range of customers at competitive prices. While the intended market is wide ranging, the target customers are the fashion-conscious women within the age bracket and are sizes 8-18. The goal was to reach out to the customer and offer a range of ‘superb designs at very affordable prices’. The control of the supply chain, its sourcing and merchandising, as well as the appearance of the selling space in the store was assigned to George Davis. This range provided customers a sense of pride because of the limited availability of the clothings. The marketing strategy gives the customer a feeling of exclusivity and the distinctiveness of having purchased a product that is unique and special. The products have a superb design and are sold at very affordable prices, which was only 10% higher than the normal M&S ranges.
The per una products were made in small batches and Davis suggested that this range symbolizes the principles of ‘the highest quality materials’. The product designs were said to be inspired by the latest trend in fashion. Moreover, words such as ‘limited editions’, ‘individual cuts for every size’, ‘fanatical attention to detail’ and ‘ease of shopping’ were included in the brochure. It was indicated that the 300-piece collections was obtained from 90 merchants from Hongkong to central Europe. Speed in production was also a key in this range because there is a need to bring the design concept in in the shop rails in a short period of time.
The rarity of the per una was attributed to the concept that women often do not want to see items that are almost identical. As stated by David, it’s all right to have similar things when it comes to plainer pieces, but if it’s distinctive, he knows that the items have to be rare. Thus, unlike the other M&S ranges that carry 20 style together, the per una was presented in small numbers.
It has always been the objective of Marks and Spencer to be clear about their order winners and qualifiers. The order winners of the different M&S ranges are: trendy and fashionable products, high quality, reasonable price, uniqueness of design and the perceived value for money. On the other hand, the order qualifiers is the need for the clothes line to cater to a wide range of sizes. Table 1 shows the summary of the different logistics performance objectives of the different product groups.
References
Anderson, D., Britt, F., & Favre, D. (n.d.). The 7 principles of supply chain management. Ten Classics from Supply Chain Management Review. pp 1-8
Goyat, S. (2011). The basis of market segmentation: A critical review of literature. European Journal of Business Management, 3 (9).
Larsen, N. (2010). European Journal of Business Management,. AARHUS School of Business. n.p
Li, S., Ragu-Nathan, R., & Rao, S. (2006). The impact of supply chain management practices on competitive advantage and organizational performance. The International Journal of Management Science. 3 pp. 107-104
