IT'S ONLY a year since we last heard the sultry voice of Irish actress Dervla Kirwan whispering "This is not just food, this is M&S food" in the retailer's television advertisements. The idea was to emphasise the fact that the chain only stocks its own "superior" produce and shuns branded goods.
But last week M&S chairman Sir Stuart Rose broke with 125 years of tradition. He announced that the store is to start selling branded grocery and household products in all its UK stores following a trial in selected English stores. For the first t
ime, M&S shoppers will be able to stock up on Marmite, Coca-Cola, Kellogg's cornflakes and Heinz beans. Household products from big names including Fairy, Pantene and Persil will also be appearing on its shelves alongside M&S classics.
This move, while significant, is just part of a gradual shift in M&S's strategy as it fights to keep a hold of customers. It has seen its core market of middle-class shoppers switch to Waitrose. The recession has also led many consumers to grasp the opportunity to bag a bargain from discount retailers, most notably Aldi and Lidl. To fight back, M&S has launched its first price comparison advertisements, highlighting products that are cheaper than those on Waitrose's shelves.
And in the run-up to Christmas, M&S's marketing drive is stepping up a gear. For the first time, there will be several different seasonal ads focusing on products ranging from clothing and household goods to food and Christmas dinner. Stephen Fry, James Nesbitt and Wallace and Gromit are among the celebrities to have been signed up by M&S.
So will this more aggressive approach work, or does it smack of desperation?
In recent years, M&S has had to turn its back on many traditions as the UK becomes an increasingly competitive market with more savvy consumers. Analysts say shoppers who would have automatically gone to M&S for the bulk of their food and other basics, such as underwear, have started to shop around. Price-conscious consumers have bought into discount-driven chains, such as Primark in the non-food sector.
Commentators point out that M&S resisted Sunday opening until it could no longer justify the loss of revenue. It finally started accepting credit cards at the end of the 1990s, at the same time as it returned to TV advertising after a 20-year absence.
Rose will be hoping his latest range of initiatives will attract new customers and retain others who may be considering defecting to a rival.
Last week he announced that pre-tax profits for the half year came in at £306.7 million, slightly down from £307.8m last time. Like-for-like sales, stripping out new floorspace, were down 0.9 per cent in the UK. While these figures were slightly better than feared, Rose said consumer confidence remains "fragile".
Against that backdrop, Rose and John Dixon, executive director of food at M&S, have high hopes for the move to sell branded grocery and household products alongside its own ranges.
Rose says: "Our customers are at the heart of this decision – they lead increasingly busy lives, so buying those essential, must-have branded products at M&S will help save them time. It will be so much more convenient for our customers to get what they need from M&S rather than having to go elsewhere."
Sam Hart, retail analyst with Charles Stanley, says: "The branded goods will work, as customers will be able to do their full shop at M&S, when previously it was seen as somewhere to go and top up."
Other analysts are unconvinced. Nick Bubb, managing director and head of UK general and food retail research at Pali International, says: "This misses the bigger picture. M&S don't have stores big enough to compete with supermarkets. Trying to cram in another line of groceries is neither here nor there."
He adds that while Rose claims customers want branded goods, it is unclear how many have actually said so. "I don't think it will change things," he says. Other analysts say M&S's initiatives are no more than tinkering around the edges and that mediocre sales are a bigger issue needing tackled.
"M&S's sales are mediocre compared to Waitrose," says Bubb. "The gap in performance must be frustrating for Dixon and Rose."
Rose will be hoping for a V-shaped recovery from recession that will see confidence return to the high street, according to Bubb. However, he says there is a worry such a recovery is already happening and it is Waitrose, not M&S, which is benefiting.
If the jury is out on M&S selling Marmite, what is the likely impact of M&S's star-studded TV ad campaign, which goes live this week? The ads, created by agency Rainey Kelly Campbell Roalfe/Y&R, will ask celebrities what they see as the key ingredient for a perfect Christmas.
Mark Roalfe, chairman of RKCR/Y&R, said: "Over the years the M&S Christmas ad has become an institution, with the public looking forward to being entertained.
"We've taken some of the nation's favourite stars and put them with some of M&S's favourite products, without which Christmas wouldn't be Christmas."
