Marks and Spencer have been at the top of their game for a very long time and have always been renowned for quality and value. They are one of the UK’s best known retailers and were the very first British retailer to make a pre-tax profit of over £1 billion in 1998 (BBC NEWS, May, 1998). However, M&S plunged into crisis in 1999 and became stuck in terms of their corporate identity. As always, the marketplace was rapidly evolving due to consumer demand but M&S were not progressing with the demands of the consumer industry. They became reliant on their reputation of quality and value for your money rather than supplying what the consumers desired. The fashion sector of retail was overcome with demand and many organisations were improving their products to meet what the consumer of the day wanted. However M&S failed to do the same, in turn other retail companies began bettering the M&S reputation of quality and value. Consequently, their profits before tax dropped to almost half of the previous year, 1998.
“Marks and Spencer had failed to ‘move with the times’ and cater for a new generation of more affluent and fashion-conscious consumers who no longer saw the M&S brand as appropriate to their lifestyles and image.” (Oliver, 2002, p. 261).
Although their reputation did remain intact for a while, however they began to lose clientele ad were not gaining any new consumers. It seems the demand in the market had set much higher expectations in the eyes of the masses. Therefore their popularity began to slip as they were not innovative and their brand image became boring to the UK consumers. It did not take long for the brand and management of M&S to come under attack by the media.
“The key word for M&S is plain- plain as in decent honest-to-goodness and plain as in Jane.” (Walsh, 1999).
It seems that Marks and Spencer were unaware, at this time, of the need to supply the products ones public’s desire, as well as the importance of maintaining your reputation. As the quote above demonstrates, their publics still respected M&S but felt they had become plain and unimaginative in terms of their products. Thankfully, Marks and Spencer learnt from their mistakes and went on to readdress their mission and values statement, as well as their products. In 2007 a poll was conducted by The Confederation of British Industry (CBI) which aimed to find out which organisation had the best reputation. Marks and Spencer came out on top of the poll with almost double the credits of the second best which was John Lewis (Talking Retail, 2007).
Marks and Spencer managed to completely turn around their business and since then have maintained a good reputation and their place at the top of the retail game with corporate social responsibility campaigns like ‘Plan A’. It was in 2007 that they launched ‘Plan A’: it consists of a set of goals that, as a whole, they are working towards to make them globally renowned for being the most sustainable retailer across the world. It is arguable that this project has actually enhanced M&S’s popularity due to the fact that the organisation saw a pre-tax profit of over £1 billion in 2008, 10 years since the last time they reached the £1 billion point. To achieve a mutual understanding and respect between an organisation and all stakeholders it is imperative to take note of stakeholder opinions and current trends to allow the organisation to set morals and values that are parallel to those of their publics. Therefore projects like ‘Plan A’ are an important stepping-stone to a positive reputation.
“Research has found that 9 out of 10 consumers reporting that when choosing between products that are similar in quality and price, the reputation of the company determines which product or service they buy” (Mackiewicz, 1993).
Thus, M&S will receive the custom of many more consumers, due to their positive reputation for having high moral and ethical standards, than organisations that do not note the importance of this.
In M&S’s ‘Half Year Results 2011/12’ their CEO stated that,
“Marks & Spencer performed well in the first half. Sales were ahead of last year despite tough comparatives and a challenging economic environment.” (Marc Bolland, 2011).
This proves that Marks and Spencer have highly benefited from their determination to identify with their publics to gain popularity and build and maintain a good reputation.
