Suppliers should question M&S brand strategy before paying up

How can Marks & Spencer ask its suppliers to help fund its store revamp plans when the retailer has yet to identify its core market?

Marks & Spencer is proposing changes to its supplier relationships that suggest its management is sharper than the brand’s cosy reputation. The company is reportedly asking its non-food suppliers to contribute millions of pounds to aid its store revamp plans and future marketing campaigns.

Supplier contributions are common in the retail industry, of course, but this takes their input to a new level. M&S chief executive Marc Bolland has apparently asked his suppliers for an one-off investment in its £600m revamp of stores and raised marketing costs.

This type of explicit funding request is far more rare than the usual regular contributions. The retailer has suggested the funding could come through a 1.25% retrospective levy on the annual turnover of the business suppliers did with M&S to August 2011.

M&S sees the cash as a way for these business partners to share in the company’s expansion plans, telling the Financial Times that suppliers need to consider themselves “part of the journey”.

I’m all for companies and their suppliers working together to make business more efficient. With times on the high street so tough, it seems logical for everyone to pull together. But since former CEO Sir Stuart Rose already spent a reported £2bn on store makeovers a few years ago, is this a question of suppliers being asked to throw good money after bad?

Before M&S takes more cash from its suppliers, it needs to decide who it is selling to. Most clothing retailers take one of two approaches: sell multiple different branded ranges that appeal to a wide group, like a department store; or specialise in one type of clothing. M&S has adopted the former approach for its women’s range but the result is simply a confused mish-mash of products that stretch across the Classic, Indigo Collection, Autograph, Limited Collection, Plus and Per Una sub-brands.

I wander out of Limited Collection where I’m looking at resin-coated leggings to find myself surrounded by crumpled-looking flowing skirts in Per Una. There isn’t enough of any one range to make a visit worthwhile when my time and money are so short.

M&S can’t compete on price with cheaper, youth-focused retailers, so it needs to rival those brands offering clothes at a higher price point. And those businesses are doing well. Next, which also serves professionals, is valued almost as highly by the stock market as M&S despite having a far lower turnover, while COS Stores and Zara also do a good job of providing reinvented classics. House of Fraser, too, has recently launched a Mary Portas-designed range that would fit alongside Limited Collection beautifully. It is these brands’ consumers that Marc Bolland should be poaching.

So, setting aside the product, let’s look at the marketing that the new levy on suppliers can help pay for. Currently, M&S has partnered with TV show The X Factor this year to be its exclusive fashion partner. I understand why it has done so, of course, because The X Factor is the biggest show on the telly.

But I think it is entirely the wrong fit for the brand. While a wide group of people watch The X Factor, those appearing on the show and being dressed by the stylists tend to be largely under 25, at least the ones that do well. Is M&S a youth retailer? I’d say no.

Marketing Week (21 September) featured retailer Forever 21, which changes its stock daily for its fickle young audience. M&S simply isn’t that kind of brand it has always stood for quality rather than fast turnover. That is no bad thing. It should make a virtue of this as by appealing to professionals, rather than drawing in young shoppers who will find the products out of their price range.

M&S also needs to sort out its irrelevant celebrity endorsements. The company’s most recent ad campaign for its Autograph collection features film stars Ryan Reynolds who is more famous for having been married to Scarlett Johansson than for any movie and Rosie Huntington-Whiteley.

Celebrity endorsement is very hard to judge. If you get it right, everyone applauds you for tapping in perfectly to the brand’s image. M&S have done this once in the past with supermodel Twiggy, who for a period managed to encapsulate the edginess of swinging Sixties London with being the age of a lot of M&S customers.

But neither Reynolds nor Huntington-Whiteley are particularly relevant to M&S or its shoppers. The ads could be for any clothing retailer; there is nothing distinctive about them.

With times so tough for clothing suppliers at the moment, Bolland will probably get his much-needed contributions. But if I were a supplier, I would take this chance to ask questions about the brand’s strategy. Can revamping stores work if the product doesn’t also receive an overhaul? Why market to the under-25s through The X Factor when so few of the brand’s ranges seem to be devoted to them?

M&S is a brand with a fantastic heritage and perhaps this kind of supplier request can genuinely refuel the business. But until the company works out its overall strategy, no amount of young people belting out hits on The X Factor wearing its clothes will be enough to convince me this is a brand with a fantastic future.