Feature: Brand M&S: Back on Top

Gill Dunsford, Managing Director of experiential agency Impetus, discusses the recent brand makeover behind the rising profits at M&S.

It’s no secret that UK retailers have seen better days: total like-for-like sales were up at only 1.3 percent over the year. So the news that the troubled Marks and Spencer brand has just reported its highest first-half profit in nearly a decade comes as a welcome rest bite from the doom and gloom forecasted by retail experts. This follows the entry of chairman Stuart Rose in 2004, whose efforts of brand rejuvenation have produced such outstanding results that as Christmas approaches, M&S shares now stand at the record price of 716p.

So stability is back with the brand; but how did this British shopping institution manage to fall so dramatically from grace that prior to Stuart Rose’s entry in 2004 it was facing a second take-over bid?

The challenges that M&S have faced are, brand experts believe, primarily down to a number of factors including what is known as brand stretch. Unlike a department store, everything from woolly jumpers to frozen chips is sold under the same brand at M&S. This approach helped to cement its reputation as a quintessentially British brand selling quality goods across the consumer board. However, its position as a long-standing retailer was damaged by its image as an old-fashioned shop with old-fashioned practices frequented by old ladies. Younger men and women saw the non-food range as frumpy and expensive in comparison to emerging competitors such as Next, Top Shop, Oasis, Uniqloand Primark. The layout of M&S was perceived as musty and out-moded and the service had an unmistakeably granny attitude. The primary appeal of the brand – ‘quality’ – was deemed to be less important than fashion and price. The new consumers just didn’t ‘get’ the fact that everything had to be M&S branded. In an age of individual brand choice, only having one brand seemed like no choice at all.

To stop the rot a makeover was needed, and this meant giving M&S a dynamic injection, but things had to get worse before they got better.

The 2001 Christmas advertising campaign marked M&S as the worst performing high street chain for the third consecutive year. The new advertising campaign made things worse. No clothes were in sight in the ad, as the it depicted a stark naked size 14 model running up a hill and declaring: “I’m normal!.” This created a tide of negative PR that demonstrated that M&S’s attempt to draw in the public’s emotional attachment had drastically backfired. Instead of the majority of British women, who are indeed a size 14, identifying with the model, they were turned off in their droves and confused by the message. M&S forgot that they need to communicate desires and aspirations rather than simply make a semi-political statement. It turned off loyal customers and left potential new customers embarrassed; it looked like your wayward Aunty at the Christmas party who overdid it on the sherry.

After disputes in the boardroom and considerable shareholder pressure, Stuart Rose took over in 2004 and has since driven the evolution of the brand into the 21st century. M&S is now expanding its food division to take into account booming health trends: 200 new locations in Britain have been identified for stand-alone ‘Simply Food’ stores. The importance of advertising in re-establishing a brand image has been realised and M&S has just been awarded the most coveted award in the advertising industry for its Christmas campaign: the Grand Prix at the IPA Effectiveness Awards.

The award winning campaign featuring top British models skipping through the streets of London works because it is aspirational while reinventing the core values of Britishness that made M&S so ubiquitous in its heyday. The brand associations are spot on: the iconic model Twiggy is a great metaphor for an institution of style making a comeback and all of the high profile models appeal across the age ranges.

A complete rehaulof the clothes style has been undertaken including the highly successful Autograph range where famous British designers are commissioned to create affordable lines for the M&S brand. The décor of the stores has been taken out of a time warp and refashioned into a contemporary retail space, and the outmoded rule of no card payments has been abolished. Even electrical goods have been incorporated into the brand stretch expansion

The innovative new promotional campaigns led by Rose under the Your M&S banner have generated over £18m additional customer visits. M&S has reversed its fortunes despite competition from Tesco holding back revenue from its rivals Next and BHS. The two retail giants are finding themselves in the same position as M&S four years ago: a tired brand image that fails to have resonance for consumers.

Although Rose is cautious in maintaining that profits have ‘stabilised’ rather than fully recovered, the brand makeover has surely been instrumental in preventing M&S from falling into relative obscurity. As one of Rose’s predecessors said recently: “The test of a good business is how it copes with adversity.” With record projected profits for Christmas on the horizon, M&S has shown thus far that it is able to deal with adversity. M&S deserves a particularly happy Christmas and a prosperous New Year.