Marks & Spencer is expanding into the utility market with the launch of M&S Energy, a move seen by some as a desperate attempt to increase footfall in stores. It comes just weeks after the retailer suffered its worst quarterly sales since the beginning of 2005.
M&S Energy, a partnership with Scottish & Southern Energy, will offer gas and electricity and will be sold exclusively through stores and a new website mandsenergy.com from October 27. The initiative will be rolled out nationally from the end of November.
Customers who buy M&S Energy will be rewarded with store vouchers for helping the environment by reducing their energy usage, and will also receive store vouchers when they sign up.
Dual-fuel customers switching to M&S Energy will receive a £20 M&S voucher on signing up and a further £10 voucher for each year they remain with M&S Energy.
The new offer will be sold as part of its Homes division, which sells furniture, and also M&S Direct, the retailer’s online division.
Carl Leaver (pictured), director of international, Homes and M&S Direct, says: “The energy sector can be quite complex and we want to make it simpler for our customers. We also understand that the cost of living has risen and we hope to encourage them to save money by helping them reduce their energy usage, as well as giving M&S store vouchers as rewards for doing so.”
The launch comes just a week after the retailer announced that like-for-like sales had fallen by 6.1% over the three months to September 27. Sales of clothing and homewares fell by 6.4%, while food dropped 5.9%. At the time, executive chairman Sir Stuart Rose said that M&S will be scaling back its investment programme to cope with the tougher economic climate.
The launch of M&S Energy is reminiscent of Comet striking a similar partnership with npower four years ago (MW May 6, 2004); Sainsbury’s affinity deal with ScottishPower five years ago (MW September 4, 2003); and Lloyds TSB selling gas and electricity (MW July 31, 2003).