This report analyses the impact of external and internal influences

This report analyses the impact of external and internal influences on the business strategies of Marks and Spencer (M&S) between 1996 and 2002, and evaluates the factors affecting them.

The report basically identifies the main factors affecting the demand for M&S products by analyzing the weaknesses and threats faced by the company. It furthers the discussion by pointing out the changes, which the company tried to bring about in its marketing mix elements, branding strategy and value chain to enhance its market share and profitability.

The major finding is that M&S had successful business strategies and marketing plans. However, the company could not maintain these advantages continuously, and faced a slowdown during the period 1998-2001. The main factors that contributed to the slowdown were the insularity shown by the company, which made it less responsive to the changing market conditions.

What was to become Britain’s largest retailer began in Leeds in 1884 as a market stall. It was started by Michael Marks and later supported by Tom Spencer when they decided to set up permanent stores in UK.

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Together, Marks and Spencer raised 600 pounds and set up a network of shops in the surrounding area that came to be called ‘Marks & Spencer’s Penny Bazaars’.

Until very recently M&S thrived by following a model that built upon Michael Marks and Tom Spencer’s original concept. Its staff viewed the company with pride and they and M&S’s suppliers all saw themselves as part of something very special – part of a collective.

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It had built a reputation among customers for quality, dependability and classic, if functional, styling. It grew to over 70,000 employees, to be the most visible retailer in Britain’s high streets, to be the provider of 40% of all women’s underwear and 25% of men’s suits sold in the UK, and to be the first retailer in Britain to gross over �1billion in annual profits.

However, the past few years witnessed M&S fall on hard times in quite a spectacular fashion.

The report specifically identifies the reasons for this fall in its market share. It first points out the major factors affecting the demand for M&S products, followed by an analysis of the weaknesses of M&S that it had due to controllable factors affecting the demand for its products, and the threats that it faced with regards to the external or uncontrollable factors affecting demand.

The report then describes the changes that M&S tried bringing about in the elements of marketing mix, i.e. price, product, place & promotion, and the elements of value chain, i.e. inbound logistics, operations, outbound logistics, marketing & sales, and customer services. Also, how these changes steered the brand management strategy of M&S remains an integral part of the discussion in the report. Read about fashion marketing concept

The underlying concept that we have used as an explanation for the factors affecting M&S is the ‘Law of Demand’. It states that ‘quantity demanded of a good increases as its price falls, and decreases as its price rises, ceteris paribus’.


Let the demand function be: Q = a – bP

Where, Q – Quantity of the good in question

P – Price of the good in question

& a, b > 0

Differentiating the demand function w.r.t price, we get,

dQ/dP = -b < 0 ,

confirming the negative relationship between Price and Quantity demanded of a good.

The related concept that is used in the discussion of the report is of the Shifts in the demand curve, and the movements along the demand curve. In this regard, it should be noted that whenever the quantity demanded changes due to changes in the price of the good in question, there is movement along the demand curve. On the other hand, whenever demand increases (or decreases) due to changes in factors other than price of the good in question, there is a rightward (or leftward) shift in the demand curve. The major factors that contribute to shifts in the demand curve are:

* Change in consumer tastes & preferences

* Change in price of relative goods

* Change in income of the consumers

* Change in seasons or weather conditions.

Factors affecting the Demand for M&S products.

* Change in tastes of the consumers

There was a general trend amongst the shoppers to dress up in a manner so as to look younger, and not vice-versa. But the clothing line of M&S failed to appeal to the customers in this regard. Hence, there was a decline in the demand for the kind of clothes sold at the M&S stores, which was a result of a leftward shift in its Demand Curve.

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This report analyses the impact of external and internal influences. (2020, Jun 02). Retrieved from

This report analyses the impact of external and internal influences

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