The story of M&S is riddled with ups and downs, but it overcame the odds to become the UK’s top supermarket. 

In February 2024, Which awarded Marks and Spencer as the UKs best in-store supermarket, surpassing Aldi, Waitrose and Sainsbury’s by a wide margin. The road to recovery however was a treacherous one, with M&S dangling on a tide rope spelling disaster. The company was able to make a strong turnaround, reclaiming its past and in doing so, becoming the best supermarket in the United Kingdom. 

The best in-store supermarket

For the third year in a row, the Which survey, conducted among 3,000 shoppers, showed that Marks and Spencer remained unbeaten when it came down to delivering a pleasant and calm shopping experience to its customers. M&S scored five stars out of five for the overall customer service, including staff availability and helpfulness, store appearance and store quality. While M&S had its shortcomings, such as value for money, the company has been making efforts to reduce prices. 

M&S has been working diligently to build a strong and consistent in-store shopping experience.In October 2013, research and advisory company Forrester, spoke with Head of customer service, Jo Moran, about the company’s efforts to deliver a stellar customer experience. Moran notes that the customer experience has been ingrained in the company’s values since its foundation in 1886. Service was key for the supermarket’s growth up to the 60s and 70s. This was also the tipping point for the company, where it lost sight of its founding values.

In 2004, M&S was forced to launch a comprehensive plan to recover itself from a possible bankruptcy. The BBC made a brief report about the supermarket chain, which had crumbled down from its enviable position as one of the country’s most prestigious brands. M&S had driven itself into a struggling company, in dire need of a turnaround to prevent itself from becoming a relic of the past. 

The company was able to recover some of its lost revenue with the appointment of Luc Vandevelde, as chairman. Over the 1990s, M&S was able to make a pivot, breaking the curse of falling sales. However, ever since, executives loosened the reins, with customer satisfaction, the BBC noted, with the company falling into disrepair. 

Sales fell below market expectation between January and March, with analysts predicting a further revenue decline. Tony Shiret of Credit Suisse First Boston told the BBC, the company has been in denial about its state of affairs. Adding that its products weren’t price competitive, with consumers opting for cheaper, more aggressive rivals. By making its stores more shopper friendly, it brought further confusion to its customers, Shiret observed.  

Fragmented support at M&S 

When Moran joined the company in 2005, customer service was fragmented, with no-one steering the proverbial ship. Hence, Moran became the first Head of Customer Service, a departure from the company’s Complaints Department, which had a more passive role, having no clear strategy as to how to improve the customer experience. In a 2020 interview with The Foundation, Moran said its support operations were built upon an ‘inside out’ approach, across functional divisions.

This meant that customers’ incoming problems were handled separately, with each having their own way of managing the issue. This resulted in a fragmented customer experience, as each department had their own interpretation of the company’s core values. Moran had to devise a strategy that would reward colleagues and build strong training programs that instilled the company’s core values. 

Through this recovery plan, M&S wanted to reclaim the status it enjoyed during its glory days, delivering a better product, better service and a pleasant shopping environment. The core values necessary to deliver a great customer experience, Moran explained. M&S started to listen to its customers once more, assessing what customers were missing at the supermarket. 

The team at M&S found that customers were seeking a better service, more friendly service, with employees displaying knowledge about the products on display across its stores. Moran pointed out that over the past nine years prior to the interview, M&S has been connecting  the different in-store customers touch points, which is the company’s primary communication channel, harmonizing social media, customer service and franchise operations.  

Data driven decisions 

Moran’s program was a radical shift from the customer service operations prior to her appointment. Colleagues and managers had to be convinced this was the road ahead. Moran drove the message home by providing data that supported the need for a strategic shift. Customer responses showed pain points during the shopping experience. Addressing these first would result in significant cost reductions, leading to higher profits. This proved crucial, as it convinced executives that it was a worthwhile endeavor.

The next stage was convincing colleagues to change their way of working. This led to reluctance, as employees feared their positions were on the line. Data could reveal inefficiencies that could trigger managers to lay-off staff. Senior colleagues meanwhile became uneasy about how this would impact their interactions with customers. 

Moran had to cut through the thick layer of middle-management, which, at the time consisted of 3,500 middle managers. They oversaw 92 percent of all employees. She had to engage them in the reformulated customer experience strategy. By inviting them in groups, she explained the workings of the organization, the retail market and their crucial role. The talks revealed the difficulties middle-managers experienced in their pay progression programs, which were a major hurdle to reward employees. Moran found a group of employees who were filling to execute the newly formulated strategy. Formulating a strategy however wasn’t enough to save Marks & Spencer from its decreasing revenues.  

The next phase for M&S

In May 2017, M&S announced Archie Norman would be appointed Non-Executive chairman at the group per the 1st of September 2017, succeeding Robert Swannell, who would retire from the board. The group noted Archie would bring much needed experience to the grocery chain, having built an enviable track record as Chairman of ITV, Lazard London and Hobby Craft. Norman would prove a pivotal figure for the transformation and recovery of M&S.

In July 2018, Norman warned that the company was on the brink of collapse, with executives being forced to take drastic measures, including store closures to survive. Noram said, cited by The Guardian, the business was running a burned platform, having no right to exist, unless it was willing to change. The warning came as annual profits fell by 62 percent, dropping to $85.3 million. Revenue performance was dampened by an extensive restructuring program, costing the company an upward of $657 million. 

The closure of 100 stores represented $410 of the total costs of the restructuring program set out by executives at M&S. Reasons for drastically cutting into its retail portfolio was increased competition from Next, who had taken even more rigorous measures to prepare its business for sustainable growth, Norman explained to shareholders. M&S had to become more aggressive in shedding weight as consumer shopping behavior started to change rapidly. 

The M&S retail network, Norman explained, was riddled with unprofitable stores, who were ill suited for a changed retail landscape. The restructuring, Norman said, had to be completed years ago, warning that closing 100 stores might not be enough to safeguard profits and prevent further job losses. Noram noted the company would have to go through a pain barrier before it can build a modern estate. 

Chief executive at M&S, Steve Rowe, added that the company had been particularly slow in ramping its online operations, pointing out that its pages loaded 50 percent slower than that of its primary competitors, despite pouring over $190 million into its online storefront. Meanwhile, its fulfillment centers were nowhere near capable of handling incoming orders, staying far away from the company’s target of processing 30 percent of all clothing sales through online sales.

Evaluating customer service

During the June 2019, Retail Bulletin’s Customer Engagement Conference, Jo Moran explained the next phase of M&S’s customer experience strategy, highlighting that the company was now operating in a fast paced market, forcing it to improve its communication strategy and enable its colleagues to deliver good customer care. The company was once again re-assessing who owned customer service and how it should be adjusted to a new market reality. 

In recent years, Retail Connections noted, M&S has been extending the customer satisfaction responsibility. Individual colleagues are motivated to take responsibility over customer care and instill a sense of joint responsibility. To enable employees, managers at M&S asked what dilemma’s they experienced within their role, where frustrations arise and what tools they needed to deliver good customer care. 

M&S was in dire need of this refocus on customer centricity, as well into 2019, the future looked very bleak. In a September 2019 The Guardian editorial, the news outlet observed that the retailer was fighting a fierce battle against online players, with the possible for its FTSE 100 delisting, becoming yet another warning sign the company was bound to go down under. The retailer was caught in the middle of the Brexit chaos, a crumbling property market and saw its market share threatened by discounters, the latter being something Tesco was all too familiar with. 

The closure of iconic M&S stores, a strategy set out by Norman, served as a stark reminder that having a well-established brand is no guarantee for survival. Older generations saw their go-to stores disappear, leaving gaping holes in the rows of stores in bustling high street locations. M&S has weather many storms, with some being missteps by the company’s executives. M&S has recently missed the mark in women’s clothing, The Guardian noted, with its latest attempts seeming to completely miss the mark. 

Reshaping retail

The drastic measures undertaken over the course of 2010s have greatly helped M&S to turn the tides once again. In November 2021, The Guardian noted that by reframing operations to identify the needs of the customers, proved to be a winning strategy for M&S. The financially unstable retailer was able to turn the tides and steer itself into profitability, seeing strong performance in its online and food retail offerings, The Guardian observed.  

In January 2023, Marks and Spencer announced it would open 20 large retail outlets, adding 3,400 jobs. The larger store would offer the company’s broad range of products, from clothing, homeware to food. The 20 larger outlets would come as a restructuring of its retail offering, seeing 67 smaller stores closed. Through the opening of high profile, high street locations, M&S would maintain a top of mind presence with its core customers, Chief executive of M&S, Stuart Machin explained. 

The stores served a crucial role in the company’s omnichannel strategy, delivering a competitive advantage. By adjusting its retail formula, it would be able to better tailor to changing consumer demands, Machin added. Over the course of five years, 180 of its 247 stores would transition to deliver the full product range, and add over 100 food locations. The company expects to expand its food retail offering to 420 stores across the UK by the fiscal year 2025/26, The Guardian cited. 

The Grocer zoomed in on what made the new formula so successful for the retailer. Partner and lead food store advisor at property consultants Rapleys, Richard Curry, explained M&S had transitioned to a variety store with a broad, yet shallow, assortment of products. As competition increased, M&S shifted back to food, with its recently opened Chesterfield’s Ravenside Retail Park location serving as a primary example for a winning formula. By moving into proximity to Tesco, Aldi and Sainsbury’s it could lean into the food shopping crowd, attracting customers and lifting its profits. 

Grocery shoppers who were doing their weekly shopping at Ravenside mall, would drop by at M&S, helping to increase the average checkout value at its store. This in contrast to its high street locations, where consumers wander with less intentionality, nor are they looking to purchase groceries for an entire week. The retail park locations offer parking and thanks to their locations, are less of a hassle to reach. Retail parks add multiple entertainment options, increasing the time spent on premise. The food courts, whilst smaller than regular supermarkets in terms of floor space, allow M&S to offer the same wide assortment of groceries. 

The success continued for M&S over the course of 2023 thanks to affordable food, thanks to its partnership with online grocery partner Ocado and its Remarksable budget food assortment, which saw sales increase by 40 percent in 2023. The product line provided vital to keep customers returning as food prices for essential groceries such as milk, butter and bread soared, The Guardian commented. 

Personalized customer service

To bring its customer service to the next level, Marks and Spencer reached out to software development consultancy firm DVELP to improve personalization and enhance the digital customer service experience for its customers. M&S had an ambitious goal to bring one third of its business online, Google Cloud noted. To achieve this ambitious target, the company had to depart with switchboards installed at 13 of its stores across the UK and Ireland. The whole operation had to remain online to handle the millions of incoming calls.

The switchboard model became unfit for the growing incoming customer questions, which had reached an additional layer of complexity, putting pressure on service representatives to handle them effectively. Additionally, as incoming requests weren’t identified prior to reaching an agent, customers would wound in a maze, with calls being parsed between agents. Google Cloud commented that executives had to figure out a solution quickly to prevent major bottlenecks from occurring, in turn leading to ballooning costs. 

Prior to the implementation of Google’s voice recognition solution, M&S customers interacted with their local stores to resolve their issues and find what they were looking for. With the rise of online shopping, M&S’s digital storefront grew into a separate entity, with retail employees being unable to online place orders for customers. This meant customers would either leave empty handed or having to complete the order themselves at a later stage. This interaction alone brought damage to the grocery store’s brand. 

Enterprise Architect for Customer Engagement, Akash Parmar, was tasked to harmonize these different platforms. Retail employees needed to be able to place online orders in an easy and safe manner and the switchboard mechanism would be replaced with an advanced voice recognition platform to quickly connect customers to the right service department. At the time, M&S was nowhere near able to provide such a level of customer service and had to look outward to find the right solutions partner.

Finding a solution partner can be a long and arduous process. Not only because finding the right firm who has displayed they are capable of managing large enterprise integrations, costs can quickly spiral beyond the initial budget and support can be lackluster once the contract has been signed.  M&S started the project in 2018, allowing itself four years to make the digital transition.  

The road ahead

M&S’s history was marked by ebb and flows. Its dedication to customer service turned it into the UK’s most popular grocery brands. However, its size had simultaneously become its Achilles heel. The company had spread itself too thin, trying to offer too much. This made the company sluggish and difficult to adjust. It had alienated its customers, who came from all walks of life. M&S had to take drastic measures to realign itself in an uncertain, competitive environment. 

At the turn of the millennium, M&S acknowledged it had to better understand its customers once again. Learning about their wants and needs. Facing its lack of customer care head on. Over the years it had rebuilt its customer service operations, integrating the channels to deliver a reliable and consistent experience. However, this proved insufficient to save it from a possible bankruptcy. Under Norman, hundreds of stores were closed and new concepts were introduced to meet changing consumer behavior. 

The company is better prepared for the future, by offering a wide food offering and having a strong online grocery program that keeps it ahead of its rivals. However, the company isn’t out of the woods yet, just like Tesco, the company is feeling the pinch from discount competitors, who, in times of high inflation, act as a viable alternative for the often expensive offering at M&S. 

In July 2023, during an interview in LBC’s Money podcast, referenced by the Retail Gazette, Noram said the company’s turnaround had taken too long, with Steve Rowe’s cost-cutting program coming too late, leaving Norman with a struggling company. Reflecting on his five years at the company, Norman still questioned what he was doing everyday, trying to maintain the spirit of the turnaround, noting that the company had just scratched the surface of what the new strategy could offer.  

International expansion

In January 2024, Norman gave another stark warning about the company’s future, saying that M&S had to become a global brand in order to survive the next century. The company may have found itself in stable water for now, with this share price soaring and pulled itself back into the FTSE 100, the index for the UKs most valuable companies, Norman emphasized there was more to be done to make M&S last well into the future. 

The Times commented that the strong results gave Norman the confidence to look ahead, beyond its domestic market. Going abroad would mark the second phase of the company’s recovery. Venturing abroad however will be paired with some unpleasant memories of earlier attempts to expand the company’s horizon, such as the acquisition of American retailer Brooks Brothers or opening a flagship store along the Champs Elysées in Paris. The company had to pull out of France and China in 2017.

These unfortunate events distracted M&S from what truly mattered, a strong assortment of products and a customer service that could rival that of its new and upcoming rivals. These missteps and necessary upgrades cost the company hundreds of millions and deliver a painful blow to its reputation. Now it can look ahead with pride, as it has become an enviable brand once more.