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Marks & Spencer has been all over the UK news this week, in the way that only Marks & Spencer can.
The media and the public seem to go misty-eyed at the merest mention of the brand, and are willing it to find the good times again.
Unfortunately, we're not buying its clothing or homeware - something the new CEO wants to remedy by "putting the customer at the heart of everything".
But what does that actually mean?
Well, though the media has focused on soundbites and the M&S financial results (a brief overview is shown at the bottom of this article), it has rather unfairly skimmed over the strategic updates.
So, here's my take on what M&S is planning, which, though set to curtail profits in the short term, may revive the brand in the coming 18 months.
Giving the brand a face through improved customer service
Perhaps the most encouraging part of the M&S strategy is investment in store staffing. The basic wage will increase from £7.41 to £8.50 outside of London, and rise to £9.65 in London.
Nostalgia invoked by M&S is in large part due to the rapport that many shoppers once found with their staff, who seemed to be always on the shop floor and there to help (if needed).
Though there is still uncertainty around changes to the pension scheme, this salary change, along with a reduction in the size of the CEO's management team, could be a tonic for the culture at M&S.
Engendering great customer service is invaluable in creating brand advocates. The M&S statement puts it beautifully and concisely:
Our employees are the lifeblood of M&S and they can be the difference in converting footfall into customers.
We will improve standards and offer better service by investing in more employees in our stores.
Getting rid of white label confusion
M&S is a big brand and has big stores. However personal our affiliation with M&S, it's essentially a department store and has suffered for that as more focused retailers have championed fast fashion or luxury.
To bring back some clarity to its ranges, M&S is reducing the number of products in Autumn/Winter ranges and preventing duplication across them.
The retailer will also reduce coordination (I presume this means less matching stuff / outfits) and inspire customers with 'selective and impactful outfit merchandising'.
With M&S no longer first choice for its clothing customers (according to the brand's research), the product offering has to be crystal clear when they walk in store.
Taking customer experience back to basics
Alongside better service and sharper ranges, M&S has highlighted better availability as a part of its new strategy (no doubt sparked by that skirt).
The results statement says that 'some basic changes to the environment, coupled with great service, can turn a shopping trip into an experience.'
That much is true, but there are no specifics here as to what these changes will be. Personally, I hope this will mean making payment easier (more visible and quicker tills?) and improving experiential and functional elements (cafes, signage, customer flow).
Speaking to my Grandmother, she highlights M&S Food as an innovator in this area, providing cafe menu items (such as her preferred toastie) in the shop itself to purchase.
I predict further experiments with in-store tech such as digital rails and online order stations etc. are unlikely.
Ranges cannot be all things to all people
Possibly the most important strategic change is M&S's attempts to 're-establish style authority: focus on product, quality and fit'.
Quality and fit seem straightforward enough, but when it comes to style, M&S has to nail it colours to the mast.
It does so as follows:
We will re-establish our style authority by focusing on wearable, contemporary style and unbeatable wardrobe essentials.
Product is key to this. Our customers look to M&S not for fashion trends but for accessible products they can wear with confidence.
This will be complemented by a refocus on stylish everyday essentials, which we will continually refresh to ensure they are current and competitive, and underpinned by standout M&S innovation.
Its Alexa Chung range was successful but in targeting contemporary clothing and style favourites (and not aiming to be fashion-forward), the brand has to hit the mark across further ranges, relying on an overall authority instead of 5-10 popular pieces.
M&S has to become firmly everyday.
Know what price a modern customer is willing to pay
M&S is already some way towards restoring its price position, having lowered the price of 3.5m items so far.
It plans to reduce promotional activity, too, which should help the brand be bold in establishing a trusted brand/price that isn't diluted by constant promo messaging.
This will help the brand take full advantage of deeper clearance sales when they do occur.
A smaller brand?
As food continues to make M&S its money (more than 50% of profits), the tactics outlined above should have the effect of creating a more recognisable M&S clothing and homeware brand.
If it doesn't do this, further Simply Food openings are in danger of making M&S seem like a food brand with clothing and homeware tacked on.
Essentially the task is to make the brand seem smaller, more focused, belying its status as a department store.
Profit warnings are not just the preserve of M&S. Next and Gap have both issued them lately, and high street 'favourites' continue to disappear (e.g. BHS).
If M&S succeeds with this latest clothing and homeware rebrand, it will be one of the greatest achievements in retail and marketing. Let's hope they can do it.
Quick review of financial results
- Profits in the last financial year fell 18.5% to £488.8m.
- However, discounting one-off costs (including £200m for international store closures and PPI fines), underlying profits rose 4.3% year on year (to £689m).
- These profits were buoyed by the success of Simply Food, with Mark & Spencer's clothing and homeware sales down 2.9%.