Another set of disappointing fashion results puts pressure on Steve Rowe’s plans for Marks & Spencer.
What a turbulent week in fashion retail. As well as key trading updates from Marks & Spencer, New Look and Primark, Drapers broke the news that the founders of Footasylum have launched a new sports fashion and footwear fascia and H&M Group is gearing up to introduce a new brand concept in the UK, with the working title “P Eleven”. Not to mention the outrageous hidden camera debacle at Sports Direct.
On Tuesday M&S posted its interim results and, as expected, clothing sales are down. Chief executive Steve Rowe repeated the by-now familiar mantra that progress had been made, but as usual this was set against a disappointing performance. A quick look back at previous coverage from Drapers uncovers headlines such as “Bolland defiant as M&S fashion fails to recover” (November 2014) and “Falling sales trigger M&S shake-up” (July 2012). The retailer has been on this trajectory for years.
Rowe says he is committed to creating a “simpler business with customers at its heart”, and set out further details of his five-year turnaround plan. And to be fair to him, he has made some difficult but necessary decisions. He is axing 30 UK stores and 53 in international markets, which will give M&S a clearer focus on its core markets. It needs fewer, better stores.
A vital part of Rowe’s strategy is confirming exactly who the M&S customer is. As the retailer increases its food offering, this will shift the balance of its customer base. Do its food customers take M&S seriously as a fashion retailer? Can M&S convince them to buy both?
In terms of its fashion offer, the decision to drop the Indigo, Collezione and North Coast sub-brands is absolutely a good move, as the offer had become confusing with so many brands in the mix. A consistent fashion offer is required, focusing on who the core customer is and the product that appeals to them.
Speaking of the core customer, there is still a lot of work to be done. A collaboration with Alexa Chung is not what will revitalise M&S in the long term, neither is describing the core shopper as “Mrs M&S”. The retailer must go back to basics, moving away from the latest catwalk trends and focusing on core, quality product that is fashionable but classic. The news we are hearing that M&S is offsetting rising costs by cutting its buying teams and moving away from more third-party suppliers is worrying, as this could have a knock-on impact on quality. Quality is what M&S should be known for.
There is still no news on who will become the next head of general merchandise, and Rowe seems determined to manage this department himself. If M&S is to connect again with its fashion customer, Rowe needs to bring in fresh expertise to tighten its offer.