The history of the development of the largest British clothing retailer
Country: Great Britain
Year of foundation: 1894
Revenue: £3.715 billion (2023) — clothing and home goods
Total company revenue together with food products — £13 billion
Region of operation: more than 70 countries
Marks & Spencer is a reputable British clothing manufacturer with a hundred-year history. Since the 2000s, the company has gone far beyond the fashion industry and has developed new areas for itself, including: home goods, furniture, technology, beauty products, food and financial services, etc. Today, Marks & Spencer is a shopping and entertainment center with grocery supermarkets, cafes, entertainment venues, etc.
THE BEGINNING OF THE JOURNEY
In 1884, an immigrant from Poland, Michael Marks, with virtually no money and limited knowledge of English, came to the north of England and opened a small stall in Kirkgate Market in Leeds. Starting with a market stall, he built his retail empire based on the principle «Don’t ask the price if it costs a penny.»
In 1894, Michael found a partner, Tom Spencer, who invested 300 pounds in the business and took on helping Michael manage it. On September 28, 1894, Marks & Spencer was born. The partners began to expand the business by opening stalls, which they called «Penny Bazaars».
INNOVATIVE APPROACH
At a time when each shop had a narrow specialization and sold only one type of product, the first original idea of entrepreneurs was to combine several types of goods in one store. The emergence of a store where you could buy clothes, fabric, cereals, and fresh bread at the same time became a real sensation. At the same time, clothing remained the basis of the business. By 1900, Marks & Spencer already had 12 Penny Bazaar stores and 24 market stalls.
In the 1920s, M&S:
Service. M&S introduced the return of goods, providing a full refund upon presentation of a receipt, regardless of how long ago the goods were purchased, which was unusual for that time. And customers appreciated such loyalty.
Price and quality control. The company worked directly with British manufacturers on a permanent and long-term basis, so it was able to keep prices low, influence the design and control the quality of the clothes. And until the 1970s, the bulk of the products came from the UK.
Standardization of sizes. M&S was one of the first companies to introduce standardization of sizes.
Offer for the whole family. The company focused on satisfying the needs of all family members in one store, with children’s clothing and suits being especially popular. M&S expanded quickly, introducing new product lines.
Capitalization on British origins. During the 1930-1950s, M&S earned a reputation as a «retailer of British quality goods». They pioneered the practice of selling British-made goods, collaborating with various British manufacturers.
Advertising and celebrities. The first of the British to systematically take marketing beyond shop windows into the realm of constant and regular direct advertising. After the war, the company began hiring models for print adverts, using well-known faces of the time, including Twiggy in the 1960s. In the 1990s, M&S began working with supermodels such as Linda Evangelista and Claudia Schiffer. Models from the former Penny Bazaar even appeared on the covers of fashion magazines. For example, on the cover of Vogue for July 1996, model Amber Valletta wore a Marks & Spencer shirt.
SALES DROP
In 1998, the company experienced its peak and became the first British retailer to earn pre-tax profits of more than £1 billion. But by 2001, the company’s profits had fallen almost sevenfold from a billion pounds to £145 million. This was a result of changes in consumer preferences and the emergence of cheaper competitors such as Primark. The delay in introducing e-commerce has led to a continued decline in profits. The number of M&S stores has been significantly reduced: in 2001, Marks & Spencer had 430 stores, in 2022 — 247.
WHAT IS THE COMPANY DOING NOW?
M&S is reducing the width of its assortment to focus customers on its traditional bestsellers.
The company is rejuvenating the appearance of its products, making them more fashionable and trendy, in an attempt to attract younger customers.
Optimizing the offline network: the company plans to cut about 20% of retail space by 2028 (this is a reduction in rent to save about 400 million pounds) and leave 180 M&S branches with a full range and 420 food stores.
Increasing online sales.
MARKS & SPENCER IN RUSSIA
In Russia, M&S was presented through a franchise. In 2022, the brand decided to stop deliveries and then completely exit the Russian franchise. As of 2022, there were 48 brand stores operating in Russia.