Marks and Spencer 2012 Annual Report Download - page 7

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Overview Marks and Spencer Group plc
Overview Strategic review Financial review Governance Financial statements and other information
Annual report and financial statements 2012 05
Product focus
Clothing: The overall market remained
static, with little movement in either
volume or value. Consumers continued
to invest in staple items, looking for
increased longevity and versatility.
‘Wearability’ was a priority as they
sought stylish pieces that would last
beyond the season, complementing
and updating their existing wardrobe.
Limited budgets also meant consumers
looked to retailers for clear fashion
direction; wanting the confidence that
they were buying the ‘right’ item to
refresh their look in line with each
season’s trends.
Quality remained important and
customers recognised the merits of
buying into higher price tiers, using
promotions as a way to make these
more affordable. Value was front of
mind and we took steps to address
this with our ‘Outstanding Value’
campaign explained on page 18.
However, spending on children’s
clothing was ring fenced as female
consumers in particular put family
priorities before themselves.
Through clearer differentiation of our
sub-brands – supported by dedicated
advertising – we made it easier for
customers to find the right items for
them to refresh their look. Improved
visual merchandising also helped us
show customers how to wear the
latest trends.
Home: The housing market continued
to be sluggish and sales of furniture
and other big ticket items remained
slow. Consumers found it difficult to
justify purchasing until replacements
could not be postponed any longer.
A sentiment of ‘making do’ prevailed,
but with socialising at home taking
the place of going out, consumers
refreshed and updated their homes
with smaller accessories.
Segmenting our Home offer under
more distinctive lifestyle categories has
helped provide customers with more
inspiration for easy room updates.
Food: Growth in the food market
this year came largely from price
inflation. Intense competition between
supermarkets resulted in a constant
stream of promotions, many of which
left consumers feeling confused.
Consumers used promotions as
a strategy to reduce weekly spend
and wanted genuine value from
uncomplicated deals on the items
on their shopping list.
Food has been at the heart of
customers’ celebrations at home.
Consumers looking to treat themselves
needed reassurance they were getting
something truly special and turned to
trusted retailers, especially for important
occasions. Our promotions catered
for this determination to enjoy time
with the family, as set out on page 16.
Consumers’ willingness to spend on
products that matter also played to our
strengths, as we continued to innovate
and expand our healthy eating ranges.
Macro-economic factors have made
everyday value a growing priority for
consumers. The launch of our new
Simply M&S range showcases the
fantastic value available on over 500 of
our customers favourite food products.
GFK CONSUMER CONFIDENCE INDEX
04
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12 Mar
-45
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0
5
10