Retail Marketing Master Case Study Example | Topics and Well Written Essays - 2250 words

Retail Marketing Master - Case Study Example It also is a multi-billion pound food retailer. Most of its shops sell both of these categories. Marks & Spencer also has a third product line related to home wares such as bed linen, but this is far smaller than the other two. For much of the 20th century M&S was regarded as the leading retailer in the United Kingdom, and an icon of British business. In 1997 it became the first British retailer to make a profit before tax of over 1 billion, though within a couple of years it plunged into a crisis from which it has not yet fully recovered. It is now less than one quarter of the size of the UK's largest and most profitable retailer, Tesco(http://www.marks-and-spencer.co.uk) Marks & Spencer unlike most of its rivals didn't instantly jump into the television advertising for its marketing and to draw customers. Marks & Spencer launched its first advertisement as late as in the mid 1990s. By selling British-made goods Marks & Spencer made their reputation. They entered into long term relationships with British manufacturers, and sold the goods under the "St Michael" brand (trademark registered in 1928), which was used for both clothes and food (Wall Street Journal,2006). Initially Marks & Spencer accepted the return of unwanted goods, with no time restriction, giving full cash refunds if the receipt was shown. Now it has changed that policy and has adopted a 90-day returns policy. This act made many loyal customers of Marks & Spencer to refrain from buying. The company's main prominence is of quality, but initially it also had a reputation for offering a good value for money. When this reputation began to waver, it encountered serious difficulties. It is a fact that M&S has historically been an iconic retailer of 'British Quality Goods.'(http://www.marks-and-spencer.co.uk) In 1988, Marks & Spencer acquired an American clothing company and a US food chain, naming Brooks Brothers and Kings Super Markets respectively. Marks & Spencer profits were maximized during 1997-98. But these profits were short term due to the rising cost of using British suppliers. Customer loyalty eroded quickly as rival retailers increasingly imported their goods from low-cost countries. In addition, it also lost its fame in the young generation who were reluctant to shop with it. These factors further plunged Marks & Spencer profits into a sudden slump, which took every one by surprise. The company's share price fell by more than two thirds, and its profits fell from more than a billion pounds in 1997 and 1998 to 145 million in the year ended 31 March 2001 (Fort Worth Star-Telegram). In 2001, with changes in their business focus such as the introduction of the "Per Una" clothing range designed by George Davies, accompanied by a redesign of their underlying business model, profits recovered somewhat and M&S recovered some of its market share but this these profits were also short lived(Karen Barth, 2001). Place: Marks & Spencer have adopted an indirect marketing channel i.e. it maintains distribution channel as follows Producer Retailer Consumer Marks & Spencer usually have its own retail stores Promotion: Advertisement: