Marks and Spencer 2012 Annual Report Download - page 8

Overview Marks and Spencer Group plc Annual report and financial statements 2012 06
How are our customers shopping?
This year, customers told us that
shopping was not just about spending
their limited budget wisely. They wanted
to enjoy their experience and feel
inspired, engaged and valued by
retailers. As a result, service was seen as
a key differentiator and, in a confusing
promotional landscape, customers really
valued the assistance of helpful and
knowledgeable employees.
More consumers chose to shop across
a combination of shopping channels.
This trend was supported by the
dramatic growth of smartphone and
tablet ownership in the UK. Online and
mobile channels provided consumers
with a more convenient way to research
and buy, and many saw it as a ‘safer’
way to shop – reducing the temptation of
store browsing.
Our customers are increasingly active
online and women aged 45 to 55 spend
more time online than any other age
group. As a result, we’ve provided more
engaging content to help inform their
online research and provide
reassurance that they are making
sound purchases. We’ve also integrated
digital innovation, such as our new Style
Online offer explained on page 27, into
our stores, to add value to customers’
shopping experience.
International
Ongoing pressures in the Eurozone
resulted in challenging trading conditions
in markets such as Greece, the Czech
Republic and the Republic of Ireland.
However, there was strong GDP growth
in some markets including Russia, the
Middle East, China and India.
Our strategy is aligned with these growth
opportunities and we are focusing our
expansion on existing markets such as
India, the Middle East and the Shanghai
region of China. In doing so, we are
reducing our dependency on the UK
economic cycle and maximising the
efficiency of our existing global supply
chain and infrastructure.
Across our international customer base,
there was a consistent demand for
quality. Our British heritage, coupled with
our brand values, supported this position
– particularly on Food, with traditional
products such as tea and biscuits
performing well. In Clothing, we know
customers recognise M&S quality, but
want more clarity around our fashion
offer. Launched in autumn 2011, our
Autograph campaign (page 17) has
helped better showcase our style
credentials. The international roll-out of
our new store format will make it easier
for customers to identify the signature
style of each of our clothing sub-brands.
How does Plan A help us respond to
market pressures?
Plan A, our 180-point eco and ethical
plan, helps us tackle the sustainability
issues that face all major retailers. With
key raw materials under pressure, Plan A
helps us develop a more sustainable
supply chain – focusing on areas such as
cotton and sustainable fishing.
In a challenging economic environment,
Plan A enables us to run a more
efficient business too – reducing waste
and energy use. In turn, we are sharing
our learning with our 2,000 suppliers
worldwide – enabling them to reduce
their own manufacturing costs and
create a more sustainable future.
In a competitive marketplace, Plan A
provides a point of difference. M&S is
well known for its sustainability
credentials and is seen as a leader by
important stakeholders in the sector. In
addition, this year we worked hard to
engage customers in new and exciting
initiatives such as our Beach Clean
project, explained on page 30.
Looking ahead
Consumers are ready for another
challenging year – feeling more
prepared and in control. With a
tight rein on their budgets, value
will be more important than ever
– especially on everyday items.
They are protecting their spend for
the key events of 2012 such as the
Jubilee and Olympics and are
making plans for truly special
celebrations at home.
CUSTOMER INSIGHT
“I’m planning to
enjoy this summer
with a traditional
celebration with my
family and friends.”
Mobile sales
Purchasing from
mobile phones
increased by
over 200% in the
last 12 months.
MULTI-CHANNEL SALES
600
500
400
300
200
100
Revenue £m
08/09 09/10 10/11 11/12
Marketplace continued