M&S and Turning

Turnaround is a word frequently used in retail but much more rarely actually achieved. M&S must surely be the most “turned around” retailer and successive leadership teams have simply not delivered. This has been the context for my past scepticism. However this time, finally, we have a team that really have delivered what I regard as a truly sustainable turnaround.

The issue with a true turnaround is whether or not it lasts, and can be built upon. So many claimed turnarounds are simply short term expedients – the most common is simply cutting capex. But a solid, sustainable turnaround is about trading: optimising costs to deliver sales growth and margins competitively defendable.

M&S has always pivoted on its womenswear and the transformation in fabric quality and styling with a strong, confident handwriting is at the heart of the turnaround. Investment in the product itself has been the critical factor. Credit obviously goes to CEO Stuart Machin but Richard Price, MD Clothing & Home, has been the key to making M&S womenswear fashionable and desirable again.

The company has been getting great PR but the promise has to be delivered – returning customers need to made loyal again, and that is all about the product. There has been talk of M&S going younger but age has become irrelevant. Identifying exactly Marks’ core customer was always about attitude, mindset and pitch – difficult qualitative characteristics that Price has successfully found. Their age isn’t really important and in itself an old fashioned way of positioning a brand. M&S should not be trying to be all things to all men but reliably relevant to its core customers.

For some years M&S had ceded the middle ground and significant sales to John Lewis Partnership. More recently they have swapped positions. The question is can JLP follow Marks and establish a sustainable turnaround?