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M&S COMPANY-INDUSRY ANALYSIS .

Bargaining power of suppliers Bargaining power of suppliers in most clothing segments is relatively low but when purchasing cloths

from luxury designer firms, the bargaining power tends to be higher. M&S previously had only British suppliers for its claimed reason of high quality, but later on it

outsourced globally to lower the cost. M&S was no longer reliant on particular suppliers and therefore the bargaining power of suppliers is lowered. M&S mass purchase also leads to lower the bargaining power of suppliers.

B. Bargaining power of buyers Generally speaking, bargaining power of buyers is high. However buyers power in segment 1 is

relatively low, while that in segment 2 and 3 is high. Products in segment 1 are usually designed for the non-price-sensitive people who prefer quality and

fashion. People in favour of products in segment 2 and 3 are more price-sensitive. And normally they can choose

from a variety of companies. Thus they have high bargaining power. C. Threat from substitutes Broadly speaking, threat from substitutes is very low. Only products from different segments might

work as product to product substitutes. In times of economic recession, people may shift from segment 2 to 3. And in times of economic

development, people have more disposable income and accordingly more interest in products in segment 1 and 2 rather than 3. This means that segment 2 has the threat of substitutes from both segment 1 and 3. Products of segment

1 and 3 normally do not directly substitute each other. D. Threat from new entrants Threat from new entrants is high in segment 1 and low in segment 2 and 3.

Brand name and high capital requirements build up high entry barriers in segment 1, which can

efficiently protect existing firms from intense competition. To provide high quality and the latest fashion for segment 1, capital is required for using superior

materials, modern design, superior workmanship and sufficient expertise. Brand name is also an important competitive advantage for established firms due to the brand loyalty of people in this segment. Meanwhile, low cost and low brand loyalty, resulting in low entry barriers in segment 2 and 3, provide

more chances for potential entrants. E. Rivalry among existing firms It seemed that existing firms in the clothing industry do not compete as intensely as firms in other

industries. In relation to segment 1 and 2, M&S suffers more from the competition of segment 3. Competition in segment 3 comes from two aspects. Price-sensitivity feature of segment 3 is very likely

to lead to a price battle which will finally squeeze out profits. A number of firms competing in segment 3 will erode M&S market share. Further problem areas which need to be considered are in particular:

3. Competitive Position 3.1 Competition among existing firms. The retail industry is one of the largest industries in the UK, this market has become mature. The competition among existing firms is very high as there are many fierce competitors such as Tesco, Morrisons and Sainsbury, etc, existed in this highly competitive market, or even some tough regional retailers. Some top retailers like Tesco already maintained a certain market share, and nowadays they compete with each other not only just on prices, but focus more on better quality as well as good customer services. At this stage, M&S wants to gain market share from its competitors; the competitive rivalry will be very incentive. 3.2 Threat of new entrants Even though the barrier to entry into UK market is quite low for some large retail chain, it could not distress M&S too much. As M&S has already gained a certain market share, and built very good reputation among customers.

3.3 Pressure from Substitutes From the nature of the retail industry, we can see that different products compete for the consumer's income with other similar type of products. Such as: different meat, vegetables, and dairy, etc. There are so many alternatives open to the consumers. Different retailer can offer different products to attract their customer. There is no surprise that customers can find little difference between these similar kinds of products or services provide by various retailers. On the other hand, M&S is mainly focus on general merchandise and mainly selling own- branded products, and their price is relatively higher than the market. If customers are not satisfied with the products or services, they can easily choose other products. Therefore, the threat of substitutes is quite high. 3.4 Buying Power Even the buyers are formed by so many fragmented customers, and the purchase volume is very tiny for each customer compare with the total purchase volume. However the switch cost for the buyers is very low sometimes can be ignored in the highly competitive market like UK. They can shopping around for the best price and best quality products. On the other hand, company's sales revenue heavily depends on the customers' spending. Therefore, the buying power of consumer as a whole can be very high. 3.5 Power of Suppliers Being considered with the relationship between them and the retailers, the suppliers are in weak position and have little bargaining power. Normally, they sign contracts with the retailers but they would certainly ruin their business if they do not meet the standards which are most likely to be set by the retailers. As one of the company strategy, M&S produces its own brand product mostly. The major suppliers of these products can be seen as part of the company. So the power of supplier is low with regard to they are highly rely on the M&S. 3.6 Competitive Strategies According to the company annual report, in order to create sustainable competitive advantage, M&S will mainly focusing on their core business and aims to become a more customer focused, fast moving, and flexible business. This is expected to be achieved by continuing concentrate on offering great products, in great looking stores with great customer service.

For cloth segment, expanded Autograph' range in women's wear and the fast fashion choice in Limited Collection' in men's wear to keep the leading position. In food area, differentiate company itself through launching a range of high quality 120 Nutritionally Balanced' ready meals. In addition, M&S is also seeking the long-term growth from acquisition of new space, new food formats, new product areas, and international expansion.

A. Market M&S is tied to a generalized view of the market due to a lack of proper segmentation. It might not need

segmentation in early year since people had similar requirements and very few competitors could challenge its market leadership. However things have changed. Strong competitors emerged and different products have been required by customers. M&S failure to segment the market and to differentiate products resulted in shifting customers interests to other brands. Consequently M&S market share has been eroded. M&S must target a segment or prioritize some segments. Different marketing strategies should be raised

for each different segment so as to shield itself from competition. B. Customers Demand and Competition are the determinants of industry profit. Therefore, understanding, stimulating

or even creating demand is of great importance for profitability. Understanding customer preferences and trends was deemed as a major reason of previous success.

However, survey results of customer satisfaction in the late 1990s revealed that customers were more and more dissatisfied with product or service. This resulted from the fact, as frequently reported, that M&S no longer understood or reacted to its customers needs. As technology develops and people care more and more about clothing fashion rather than only quality

or price, the life cycle of the products in this industry tends to be short. That means, if the company does not pay sufficient attention to collect information from customers, products might be outdated soon. This would then require a swift managing change including new designs, new concepts and new materials to meet customers needs.

In addition to the product itself, value-added service is also an important part. The value of the product

or service to customers should be created to appeal to customers. Furthermore, well working long-term relationships need to be established between the company and customers. This should greatly help to maintain them and to increase their loyalty to the brand. Salsburys proposal of customer-focused approach should be appreciated. Unfortunately, the fact not to segregate different items and to deal with customer complains poorly reveals that this approach seemed not to be implemented very well.

Marketing Mix The marketing mix includes all the elements associated with the product(s) that affect whether the consumer decides to buy or not. There are clearly many factors which influence a consumers decision to buy something and these are all part of the marketing mix (the 4 Ps.) PRICE M&S charges premium prices through its differentiation strategy. PRODUCT M&S markets its products based on superior quality and reliability. PLACE M&S products are sold through its large number of stores in city and town centres. More recently M&S has expanded its sales distribution channels through the Internet via its website (online shopping) PROMOTION M&S integrated marketing communication is delivered through media in various forms, advertising, TV, national newspapers and magazines as well as through the web site.

Marketing mix marketing mix is a set of controllable tactical marketing tool that the firm blends to produce the response it wants in the target market .(Kotler, 2008) The term marketing mix refers to major factors that must be attended to appropriately market a product or services. It is also called 4ps of marketing.(David Jobber). The elements of marketing mix comprise; Product Price Promotion Place (Distribution) The M&Ss marketing department comprises a suitable marketing strategy by ascertaining important factors of the marketing operation, since as to decide the appropriate marketing mix of the 4 Ps for its target market.

1. Product In simple, it includes all the and combination of goods and services which an organisation offers to the customers (Kotler & Amstrong 2004). At three stage a product or service can provide satisfaction, those are: Core benefit Actual product or services Additional range of benefits M&Ss Product Marks and Spenser ensure that, they use genuine for dishes. It is through continuous research. In addition, unless the preservative foods provide safety and quality they avoid that. In 2008 October M&S introduced six new double range of vegetarian meals while they recognised the new type of customers known as the meat reducer (who like to reduce the amount of meat they have). M&S identified this dishes will demand to both vegetarian and non vegetarian by providing delicious ingredients. The new range includes: Artichoke and Edam me bean risotto: is the mix of nutty flavour of Artichoke and Edam me beans chunky texture. This two combines in a creamy risotto. Roast Butternut Squash Curry with rice: This coconut based sauce, served by basmati rice with the fragrance of cinnamon, turmeric , mustard seeds, and served basmati rice. Mixed Bean and Roast Pepper Filo Pies : with the ingredients of roasted pepper and tomato sause and folded with beans mix. Spicy Vegetable Tagine with Rice: Its an amazing mixture of cauliflower, tomatoes and spice , and it is based on a Tagine sauce. Moroccan Feta and Couscous Pancakes: This with the ingredients of couscus , Moroccan spices and cheese and folded in a buckwheat pancake Butternut Squash and Goats Cheese risotto: It is bases on cheese flavour blend with sweet onion and risotto rice. Now M&S focus to produce quality food to gain competitive advantage in the future.

2. Price Price is the only revenue generating element amongst the 4ps, the rest being cost centers. Pricing is the manual or automatic process of applying prices to purchase and sales orders, based on factors such as: a fixed

amount, quantity break, promotion or sales campaign, specific vendor quote, price prevailing on entry, shipment or invoice date, combination of multiple orders or lines, and many others(David Jobber) Marks and Spensers Pricing M&S has got brand loyalty. Having prices based on TESCO ASDA are charging is not suitable since we produce their own food, own packaging. To make desirable positioning, a premium pricing s is being carried out by M&S. M&S set the pricing to make available to the prosperous consumers. Nevertheless It cant be considered as the purchase driver. For the M&S products consumers expect to pay premium delivered their prospect of quality and innovation are gathered. Although quality of M&Ss food is good, due to this recession they reduce their price to take attention of their valued customer. In the future they overcome their rival through pricing as well. 3. Promotion Promotional strategies include all means through which a company communicates the benefits and values of its products and persuades targeted customers to buy them (Kotler and Armstrong, 2004). There are some purposes for promoting a product. Improving customer awareness about the product Inspire consumers to memorize the product Convince consumer to purchase the product. The major promotional tools include: Sales Promotion Advertising Public Relation Personal selling Direct marketing Marks and Spencers promotion The different types of advertising and sales promotions are implemented by marks and Spenser for effectively communicate with new and existing customers. These are according to number of factors: The market size The types and cost of product

The competitors advertising strategy The influence The law An effective advertising must have some qualities, Such as AIDA. This stands for: For attracting attention Creating interest Developing desire Leading to action Marks and Spenser had published media which comprise magazine, and newspaper to gain the benefit of targeted market. In order to promote the newly launched vegetable meals M&S has run advertising campaign BBC. In order to directly communicate with potential customers M&S also go for the sales promotion to motivate them to purchase. For instance M&S has applied 20% discount on every of their product in to attract the cusmers from Tesco, Sainsbury, ASDA ect.. In last December. Due to recession M&S has introduced a national advertising champagne pushing its 200m ethical plan for sacrificing on fashionable eco policiesi In addition to this, As M&S have their own site, where they advertise on internet, Unless customer visit website, the advertising will not be effective. Place Placement under marketing mix involves all company activities that make the product available to the targeted customer (Kotler and Armstrong, 2004). Based on various factors such as sales, communications and contractual considerations, various ways of making products available to customers can be used (Lazer, 1971). M&Ss Place M&S has about 600 stores in UK having food department in almost every stores where they generate profit more than other departments. So M&S provide best place for food department to compete with food retail giants TESCO, Sainsbury, Waitrose ect. M&S has opened simply food stores where they have most sale and more product availability. M&S control their supply chain without any difficulties since they sell their own brands. In order to attract Indian customers M&S has placed more Indian foods in the stores in Wembly, Barent cross and other simply food stores. M&S has set rail system to deliver wines from France to our midland distribution centre recently.

M&S offer got direct marketing to the customer, in the form of E let, digital shopping and internet shopping which enable customer to satisfy their needs. Due to this new innovation M&S target more potential customers and get a competitive advantage. Conclusion; overall reviewing reaseach I came to know that m&s has been doing v good since last 6 year and in next 12 month its flexable strategy it got compitative advantage over its rivals.better marketing strategy,improved customer service,best quality food makes m&s a unique food mart in food market.now m&s also target different communities ,ages, and sex and improved its stores. By surveying its marketing mix there are some hurdles in making its product in cheap price but by taking some necessary steps it is possible to take customer attention.although the strategy it is impossible for m&s to be cost leadership because of its quality product reputation in market but can try to attract consumer attraction to promaote its product and give offers like buy get get one free it is demand of this recession tough time for survival in next 12 month.in the nutshell we may say that m&s is doing very good and in future it will be better and improved.