Marc Bolland joins Marks & Spencer earlier than planned to join in the Xmas festivities. Share price swings lead him to be dubbed the billion dollar man
So what do we know about the new leader, and the task ahead of him? Websites, usually reliable fast access to such information, are a bit sluggish at present. The Guardian has been following the story more carefully than most, and offered a snapshot view
The 50-year-old Dutchman has certainly been a crowd pleaser at Morrisons, which he has quietly reinvigorated in the past three years. When he arrived in 2006, profits had crashed to a low of £54m after the botched takeover of Safeway. This year, profits at Morrisons are expected to top £750m, well ahead of larger rival Sainsbury’s, which is expected to make £540m. Such was the impact on the share prices of both companies following the announcement of Bolland’s appointment – Marks surged 6% while Morrisons sank 5% – that he is being dubbed the “$1bn man” in the City.
The article went on to outline the challenges facing M&S.
M&S used to lead the market here, but has been left behind as rivals have raised their games. This area should be Bolland’s forte. But he must decide whether to plough funds into online delivery – where no one makes money apart from Tesco – and its convenience chain Simply Food.
According to research by Datamonitor, more than 75% of shoppers in the food halls are over 45. In the fashion department the problem is worse: 65% of its main clothing shoppers were aged over 55, as were those who accounted for 48% of spending on M&S clothing last year. Bolland will have to find a way to make the stores, the ranges and the brand appeal to younger shoppers, particularly those with young families.
[Sir Stuart] Rose reckons his predecessor’s decision to shut down its European stores was an act of retail vandalism and has been busily re-opening branches overseas, many as joint ventures and franchises…A much-hyped first store in China had a disastrous first few months…Analyst Katherine Wynne at Investec reckons overseas growth is vital for M&S’s future and expects Bolland to beef up the retailer with international expertise.
For a while, after Rose and his marketing sidekick Steven Sharp moved in, the tired old brand did look a little different but recently it has been back to dull old Marks with little brand appeal…Bolland – who learned about marketing in the beer business says he has “worked a lot in re-energising brands” . Bolland will have to repeat [his success at Morrisons] at M&S.
Since May, finance director Dyson has been leading an internal project updating M&S’s systems and distribution network. When he unveiled the first results last month, the reaction of some analysts was: “Why didn’t Rose tackle these problems earlier?” The network of 110 warehouses has to be reduced to four “mega-shed” distribution centres. Too many stores in the wrong place – on high streets rather than retail parks – and its internet sales are far lower than they should be, reflecting the age profile of M&S’s clientele.
A Xmas Story
There was another Xmas story at Marks. I add it as it may offer an insight to the corporate culture. I must have watched a typical treacle-sweet advertisement. but my attention span hadn’t taken in its so-called offensive finish. This involved a model (presumably) prancing briefly and ironically (presumably) through a pantomime-style forest in her M&S lingerie (presumably).
Somehow the slow build-up to its ‘offensive’ end seems to me to typify the struggles and conflicts at the company as it tries to modernise its image while holding fast to its traditions.