Both external and internal issues influence how the company decides to operate. The external issues will, of course remain the same for all the players in the market. With regard to Marks & Spencer, we can categorise them as follows: ExternalInternal
-Fast changing market and tough trading conditions
– failure to recognize and react to changing market trends
– Consumers’ change of taste
– Decentralised marketing function: inconsistent brand image
– War in Iraq
– slower economy
-The versus the Euro – imports/exports
-Increased competition locally and from foreign companies
Marks & Spencer – SWOT Analysis.
What follows is M&S’ SWOT Analysis. It highlights the company’s strong and weak points and areas they can improve. Strengths
•Provides quality products
•Allows for online shoppingWeaknesses
•Slow to change
•Lack of newness
•Clothing: does not really reflect younger women’s taste Opportunities
•Keep renewing their womenswear range
•Better define target age group (currently, it is not clear: older or younger women?)
•Stores refurbishment: provide a more upbeat look
•Use of good CRM systems that can help them keep track of customers’ demands.
•Loss of market share as a result of intense competition – competition e.g. in the food sector, is advancing with similar products.
Marks & Spencer have recognised that they haven’t responded quickly enough to consumers’ changing needs and preferences. For instance, their clothing range – especially womenswear – has suffered from lack of novelty. It did not represent the modern woman’s taste for a more casual look. Similarly, in the food section, although they have retained their market position, sales were less significant – this means that competitors are quickly catching up (Interim results presentation 2004).
Currently, Marks & Spencer are planning to inject the business with new, fresh ideas and products, especially in their clothing segment – both women’s and men’s range. Some of the actions being taken, as outlined in their 2004 Annual Report (Chairman’s Statement), are as follows:
•Improving the management team.
•Improving their supply chain.
•Divestment of less profitable businesses.
•Plan to make their special foods more available – opening ‘Simply Food’ stores.
•Re-branding of their financial offer – introduced the &more credit and loyalty card.
•Centralisation of their marketing function.