Marks and Spencer 2006 Annual Report Download - page 15

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Marks and Spencer Group plc
M&S food stands, above all,
for outstanding quality and
innovation. Our customers
expect us to offer them new,
delicious food, sourced
responsibly, and to create and
interpret new trends in eating.
We are most successful when we do this
with confidence, combining the skills of our
buying teams, our food technologists and
our suppliers.
In recent years, we have chased too wide a
range of initiatives, often done on too small
a scale to have real impact. We have since
refined our product strategy, concentrating
on four main areas – fresh, natural, healthy
food; special celebration products; authentic
ready meal ranges and exceptional
everyday food like our ‘Oakham’ chicken
and Aberdeen Angus steaks.
During the year we backed this strategy
with powerful advertising and bold product
development – including launching 1,600
entirely new lines and upgrading a further
1,100. We are also exploring different ways
to make our food available to our customers
through new locations and formats.
Performance
Total Food sales grew by 7% to £3.6bn and
also enjoyed a 3.6% increase in like-for-like
sales. Throughout the year, key areas such
as fresh produce, particularly fresh fruit
salads and juices, as well as meat,
delicatessen and ‘Food to Go’ products
experienced strong growth. Christmas was
particularly successful with like-for-like sales
growing 5%. Sales in the last quarter
continued to improve, helped especially by
a healthy eating campaign which included
200 newly developed products.
Improved marketing also contributed to our
performance. Customers particularly
welcomed our Food Festivals where those
spending more than £35 could sample for
free some of the products we are most
proud of including salmon, wine and
chocolate puddings.
Healthy eating
People want to know more about their
food and are becoming increasingly health
conscious.
We made healthy eating a particular priority
during the year, increasing the number of
products carrying our ‘Eat Well’ sunflower
logo by 300 to over 1,000 – around 20% of
our food offer.
Our ‘Eat Well’ logo is placed on foods
which do not contain artificial colours,
flavourings or sweeteners and are either
naturally healthy foods or nutritionally
balanced, based on current Government
guidelines. This approach has been
assessed by independent nutrition experts
at the British Nutrition Foundation.
We have provided Guideline Daily Amounts
(GDAs) on all our food since August 1999
and now plan to introduce colour-coded
GDAs to help customers make healthier
food choices.
Concern about additives in foods is also
growing and we have moved faster than
anyone to remove them. During the year, we
were first to commit ourselves to removing
hydrogenated fats from virtually all our foods
by the end of 2006 – a challenging
commitment, already achieved in over 90%
of affected products.
Our ‘Marks & Spencer Cook!’ range –
providing customers with prepared raw
ingredients to make delicious meals – is
already additive-free. The 19 products in our
‘Eat Well for Kids’ range contain no artificial
colours, flavours or sweeteners and no
added preservatives.
We remain the only major retailer to have met
the British Retail Consortium’s salt reduction
targets and are on track to meet the Food
Standard Agency’s targets for 2010.
In another innovation, we introduced a
unique Omega-3 rich milk, through a
specially-developed feed for our dairy cows
which allows them to produce milk rich in
the optimum sort of Omega-3, properly
balanced with Omega-6.
While healthy eating is a key trend, we
never lose sight of the importance of great
taste and eating quality. We employ trained
chefs to develop new dishes and improve
existing lines.
POMEGRANATE
JUICE – A FIRST
20%
of our Food offer carries the
‘Eat Well’ sunflower logo.
Pomegranates are one of the
most popular superfoods,
but finding a way to make
the first totally natural
pomegranate juice required
lateral thinking.
Pomegranate crushing
machines pulp the whole fruit
and not just the sweet centre,
so most pomegranate drinks
have to be sweetened with
added sugars. One of our
technologists spotted the
potential to adapt a passion
fruit crusher to crush only the
centre of the pomegranates.
The technology was installed
in Egypt where pomegranates
are grown in abundance. In
October, we launched the
UK’s first fresh and natural
pomegranate juice – one
of our many innovations
last year.
www.marksandspencer.com/food2006 13