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Marks & Spencer adopted a sustainability campaign, “Look Behind the Label” in an attempt to gain the growing fair trade market share in the UK. The campaign was a short-term success.However, consumer research informed them that they needed to demonstrate their intention to continue to support sustainability issues that performance and credibility should come first, activities are more important than words, customers want to see the benefits of change and communications should be simple. In response, M&S integrated their sustainability goals tightly with their business strategy. This case study looks at whether this strategy was successful for M&S and why.
Citation preview
Managerial Marketing SUS6060
Marketing case study:
The Green Path to Gold: Did this work for M&S?
Jos Hill
10/04/2010
The Green Path to Gold: Did this work for M&S? Jos Hill
2
Contents
Company Overview .........................................................................................................................3 UK Retail Industry Trends................................................................................................................3 M&S Marketing Challenges .............................................................................................................4 M&S Social and Environmental Campaigns.....................................................................................5
Look Behind the Label .............................................................................................................5 A recipe for short-‐term success?.............................................................................................5 Plan A.......................................................................................................................................6
What were the successful attributes of the campaign?..............................................................6 What did M&S learn and what did they do in response?........................................................7 Performance and credibility first.............................................................................................7 Activity not words: help them do simple things to make a difference....................................7 Show consumers the benefits of change ................................................................................9 A few big stories backed up by lots of small but consistent underpinning messages.............9 Plan A as an internal change management platform ..............................................................9
Did Plan A work? .......................................................................................................................10 Media mentions ....................................................................................................................10 Marketing SWOT analysis......................................................................................................12 Financial performance...........................................................................................................13
Resources ......................................................................................................................................15
The Green Path to Gold: Did this work for M&S? Jos Hill
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Company Overview
Marks & Spencer Group Plc., known as M&S in the UK, is a major British retailer that
was founded in 1884. It now has 895 stores in 40 countries, 600 of which are located in the UK.
M&S is an up-‐market food retailer and the largest clothing retailer in the UK. M&S brand all their
products with their own label (Barry, 2009). M&S is listed on the London Stock Exchange and is a
constituent of the FTSE 100 index (FTSE, 2010).
UK Retail Industry Trends
The last decade has seen a doubling of the number of stores and products and services
provided by the 4 major supermarkets in the UK: Sainsbury’s, Tesco, Morrisons and Asda, which
control 70% of the market (British Brands Group, 2010). Most industry members developed
their first CSR reports between 2005 and 2006 (IGD, 2010) and reports have presented a
scattergun of activities that companies have been engaged in. During this time, sales of
Fairtrade products in the UK has risen significantly (Figure 1) which indicates an increase in
importance of corporate social responsibility.
The Green Path to Gold: Did this work for M&S? Jos Hill
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Figure 1: Fairtrade product sales in the UK (Fairtrade Foundation, 2010)
M&S Marketing Challenges
M&S experienced a downturn during 1998 as their brand reached the maturity stage
(described by Kotler and Keller, 2006) as competing retailers, such as Tesco and Sainsbury’s,
started to offer increased quality products at reasonable prices (Carrell, 2006). M&S no longer
seemed “special” to UK retailers. Because M&S brands its own products and only carries these
brands, the reduction in appeal affected the whole company rather than select product lines. To
turn this situation around, M&S needed to reinvigorate the M&S brand as a whole and
differentiate itself to regain market share. M&S initiated sustainability campaign in an attempt
to turn its fate around and set the company back on a course of profit and growth. This paper
looks at whether this strategy was successful for M&S and why.
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EsCmated UK retail sales of Fairtrade products by value 1998-‐2009 (£ million)
The Green Path to Gold: Did this work for M&S? Jos Hill
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M&S Social and Environmental Campaigns
Look Behind the Label
The 50% increase in sales of Fairtrade products in the UK in 2005 (Figure 1) did not go
unnoticed to M&S. In response, they conducted some savvy market research and found that
almost one third of shoppers had put clothes back on the rails amid concerns about their origins
and 78% of shoppers wanted to know more about the way clothes were made (BBC News,
2006). M&S decided an opportunity lay in redefining their market to include ethical shoppers.
They deployed the “early adopter” strategy to claim their market share of ethical shoppers (Esty
and Winston, 2006) and set a goal to jump to the number one position in the sustainability arms
raceand launched their Look Behind the Label campaign 2006.
The aim of the campaign was to inform shoppers of the way the group sources its
products, highlighting everything from its use of toxic-‐free clothes dyes, salt reduction in ready
meals, animal welfare, Fairtrade products and sustainable seafood. This campaign was the first
by any retailer to focus on its supply chain and it cleverly increased pressure for its competitors
to demonstrate their efforts in sustainability by exposing their lack of transparent labeling
(Fibre2fasion, 2006).
A recipe for short-‐term success?
The Look behind the Labelcampaign generated a huge upswing of consumer trust
according to market research conducted by M&S (Barry, 2009). However, the company’s
research led them to understand that it would be dangerous to stop there because customers
were saying, “We’re glad you’re telling us about these issues that you are good at today – but
what are you not telling us? Are you trying to hide something?” and, “We don’t want to be
green washed. We want to be assured that this change will be for the long term” (Barry, 2009).
The Green Path to Gold: Did this work for M&S? Jos Hill
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M&S recognized that their competitors would follow them and if they did not respond
to their customers’ feedback, the company would risk losing the benefits they had achieved
through their campaign. The company decided to take their campaign to another level,
launching a new environmental and ethical plan in 2007. The campaign was branded Plan A with
the slogan “because there is no Plan B” when it comes to saving the environment.
Plan A
The Plan A campaign was launched to communicate about 100 environmental commitments
M&S would make over the following 5 years and they allocated a generous budget of £200
million to the cause. Plan A has 5 core goals:
1. Become carbon neutral;
2. Send no waste to landfill;
3. Extend sustainable sourcing;
4. Help improve the lives of people in their supply chain; and
5. Help customers and employees live a healthier lifestyle.
In 2010, M&S announced a program to be the world’s most sustainable major retailer by an
ambitious 2015. They launched 80 additional commitments to their Plan A.
What were the successful attributes of the campaign?
The key to the success of M&S was that the company listened to their customers by
conducting “brand tracking” (Kotler and Keller, 2006) throughout the campaign. They learned
that their initial campaign materials needed improvement and they made appropriate
adjustments as their learning increased(Barry, 2009).
The Green Path to Gold: Did this work for M&S? Jos Hill
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What did M&S learn and what did they do in response?
1. Performance and credibility first;
2. Activity not words: help them do simple things to make a difference;
3. Show consumers the benefits of change;
4. A few big stories backed up by lots of small but consistent underpinning messages;
5. Plan A as an internal change management platform (Barry, 2009).
Performance and credibility first
M&S modified their products by setting a goal of having at least one ethical attribute to
every product they stock (Fibre2fasion, 2010). This action helped their credibility as well as
helped to reinforce the re-‐defined M&S brand and move it out of the “brand maturity” rut they
were stuck in (as described by Kotler and Keller, 2006). They achieved successful brand re-‐
positioning by modifying their target market to include a growing market of people who want to
make ethical purchases.
Activity not words: help them do simple things to make a difference
M&S discovered the initial media release for Plan Awas complicated and intimidating to
the general public. It was too much of a jump for customers to find themselves saving the planet
when they thought they were shopping (Figure 2).
The Green Path to Gold: Did this work for M&S? Jos Hill
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Figure 2: Original media release for Plan A.
M&S replaced the manifesto approach with a campaign more relevant to people, which
was to show consumers how they can save money by going green (Figure 3).
Figure 3: Campaign to show customers how much they can save by going green.
The Green Path to Gold: Did this work for M&S? Jos Hill
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Show consumers the benefits of change
This approach had quite a bit of success, but consumers told M&S they needed to move
things on yet again. So M&S stopped lecturing their customers and instead gave then something
to do. The company launched a campaign with Oxfam to encourage people to recycle clothing.
When people gave Oxfam old M&S clothing, they received a £5 M&S token. This had a fantastic
response. Over 600 000 customers have returned their clothing, Oxfam has raised $3m for
overseas Aid work as a result, and M&S consumers started to say they felt Plan A was relevant
to them now (Barry, 2009).
A few big stories backed up by lots of small but consistent underpinning messages
M&S were also able to re-‐invigorate current campaigns by creating a new story. Their
customer research suggested they needed to keep customers engaged and feeling good about
themselves. Research also told them that 92 per cent of Brits admit they cling on to clothing
they never wear, suggesting they could do with a pre-‐winter detox. The company reinvigorated
their clothes recycling campaign with a ‘One Day Wardrobe Clearout’ with an aim to raise £1
million for Oxfam and help reduce the amount of clothing sent to landfill (Glover and
Himsworth, 2010). The £5 cost per item of clothing incurred by M&S may seem prohibitive,
however, it functioned to give customers a reason to return to an M&S store where they would
spend more money and leave feeling good about themselves. The feel-‐good factor was an
important part of the re-‐brand.
Plan A as an internal change management platform
M&S positioned themselves apart and beyond the Corporate Social Responsibility (CSR)
arms race that other retailers were participating in by re-‐defining corporate sustainability,
The Green Path to Gold: Did this work for M&S? Jos Hill
10
branding it with their plan, Plan A. To take control over any evolution beyond Plan A, they
mapped out the remaining journey towards true sustainability. See Figure 4 (Barry, 2009).
Figure 4. M&S’ re-‐definition of corporate sustainability (Barry, 2009).
Did Plan A work?
The purpose of the marketing campaign was to reinvigorate the M&S brand and help the
company recover its profits and previous status as a “darling” of retail establishments in the UK.
The success of the M&S re-‐branding campaign is analyzed here in the following ways:
1. Review of online media mentions in the past decade
2. Marketing SWOT analysis
3. Review of changes in net profit in the past decade
Media mentions
Soon after Plan Awas announced, M&S were voted the greenest supermarket and the
one most popular with socially and environmentally aware consumers (Butler, 2007; Carrell,
2006; Populus, 2007); and they continued to be rated as the highest sustainability performers in
the world (Figure 5) (Brady et al, 2010).
The Green Path to Gold: Did this work for M&S? Jos Hill
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Figure 5: Overall retailer sustainability performance by GreenBiz (from Brady et al, 2010).
Figure 6 illustrates how the number of online media articles about M&S has increased
exponentially since their Look Behind the Label and Plan A campaigns.
Figure 6: Google advance search of media mentions since 2000.
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M&S on
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M&S online media menCons
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
The Green Path to Gold: Did this work for M&S? Jos Hill
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Moreover, Citygroup announced the ethical campaign as “most successful in M&S
history” in 2006 and estimated the group had generated at least a 4 month lead on
sustainability issues on the other major retailers in the UK (Mesure, 2006).
Marketing SWOT analysis
Strengths
• M&S focused on a growing market of ethical shoppers in the UK for their re-‐branding
campaign.
• They created a significant lead on their competitors, and continued to innovate.
• Re-‐defined sustainability with their own Plan A.
• Reinforced the sustainability brand message by applying one sustainability attribute to
every product.
• Listened and acted on customer feedback.
• Campaign captures emotional story telling using short videos about their sustainable
supply chain. Use of video has been shown as the most effective means of
communicating (Anderson, 2010).
Weaknesses
• Initially the Look Behind the Label campaign was short-‐term focused and customers
wanted to know if M&S was committed to continue to make changes.
• Need to continue to make improvements in order to validate the new brand image.
Future success could hinge upon their ability to stay ahead of the curve.
• Economic recession reduced spending.
• Social or environmental issues that come to the public’s attention were M&S do not
perform well yet could undermine the brand.
The Green Path to Gold: Did this work for M&S? Jos Hill
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• M&S only stock their own branded items and do not sell their branded items through
other retailers. If favor in the M&S brand deteriorates, the whole business is affected.
Opportunities
• International growth and the opportunity to outcompete retail industries that are far
behind in terms of sustainability, for example, in the US.
Threats
• Superior performance by competing major retailers.
• Other retailers expand to offer services that M&S do not.
• Sustainability turns out to be a fad that goes out of fashion.
Financial performance
By 2008 their financial performance had bounced back to the £1 billion profit level but
they suffered during the economic downturn (Figure 7) (London Stock Exchange, 2010).
However, increased energy efficiency achieved through their activities enabled cost savings of
around £50 million in 2010 alone rendering the campaign extremely cost effective (Fibre2fasion,
2010).
Figure 7: Net profit for M&S between 1996 and 2010.
0 100 200 300 400 500 600 700 800 900
£ million
M&S Net Profit (£ million)
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
The Green Path to Gold: Did this work for M&S? Jos Hill
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Conclusions & Recommendations
There are numerous businesses in the marketplace advertising “sustainable” products
and this dilutes the term sustainable, misdirects consumers and leaves no marketing space for
companies who are making larger strides towards doing the right thing. By defining the journey
towards sustainability and branding Plan A as a step beyond CSR, the reporting framework
everyone else is doing, M&S clarified to their audience that while current activities regarding
sustainability are going in the right direction, no businesses are there yet.
The way that M&S profits bounced back along with significant media attention
demonstrates the success of their campaign. After analyzing the campaign I recommend M&S
continue to invest in campaign tracking and continue to listen and respond to their customers.
However, M&S already identified a weakness in their strategy is that the company must keep
innovating and increasing their sustainability along the path they have identified (Figure 4) in
order to maintain their market of ethical shoppers. So the question should not be “did this work
for M&S?” but rather can they continue to make it work for them?
The Green Path to Gold: Did this work for M&S? Jos Hill
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Resources
Anderson, C. (2010). Chris Anderson: How web video powers global innovation. TED Talks.
Retrieved from
http://www.ted.com/talks/chris_anderson_how_web_video_powers_global_innovation.html
Barry, M. (2009). Marks and Spencer’s Consumer Education and Empowerment Strategy.
Sustainable Brands ’09. Retrieved from
http://www.sustainablelifemedia.com/video/06012009/mike_barry_marks_spencer_sustainabl
e_retail_plan_a_communications
BBC News (2006). M&S set to launch Fairtrade range. BBC News. Retrieved from
http://news.bbc.co.uk/2/hi/business/4660410.stm
Brady, K., Hendry, J and Kanchwala, S. (2010). Retail: A Sustainability Benchmark. GreenBiz
Reports. Five Winds International. Retrieved from
http://www.greenbiz.com/business/research/report/2010/04/23/retail-‐sustainability-‐
benchmark
British Brands Group (2010). Consumer needs not being met by UK grocery market. British
Brands Group. Retrieved from
http://www.britishbrandsgroup.org.uk/upload/File/Grocery%20needs%20summary%2097.pdf
The Green Path to Gold: Did this work for M&S? Jos Hill
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Butler, S. (2007). Shoppers look behind the label to vote M&S the greenest. The Times.
Retrieved from http://www.timesonline.co.uk/tol/money/consumer_affairs/article1577339.ece
Carrell, S. (2006). Greenpeace says M&S is best. The Independent. Retrieved from
http://www.independent.co.uk/environment/greenpeace-‐says-‐mamps-‐is-‐the-‐best-‐404500.html
Esty, D. and Winston, A. (2006). Green to Gold: How smart companies use environmental
strategy to innovate, create value and build competitive advantage. Yale University Press.
Fairtrade Foundation (2010). Facts and figures on Fairtrade: Sales of Fairtrade certified products
in the UK. Retrieved from
http://www.fairtrade.org.uk/what_is_fairtrade/facts_and_figures.aspx
Fibre2fashion, (2006). A look behind the label sends M&S Galloping. Retrieved from
http://www.fibre2fashion.com/news/company-‐news/marks-‐and-‐
spencer/newsdetails.aspx?news_id=22352
Fibre2fashion, (2010). Marks & Spencer to be greenest retailer by 2015. Retrieved from
http://www.fibre2fashion.com/news/company-‐news/marks-‐and-‐
spencer/newsdetails.aspx?news_id=83058
FTSE (2010). FTSE 100 Index Constituents. Retrieved from
http://www.ftse.com/objects/csv_to_table.jsp?infoCode=100a&theseFilters=&csvAll=&theseCol
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umns=Mw==&theseTitles=&tableTitle=FTSE%20100%20Index%20Constituents&dl=&p_encoded
=1
Glover, A. and Himsworth, D. (2010). M&S Calls on customers to clear out their wardrobes to
help raise £1 million for Oxfam. Retrieved from:
http://corporate.marksandspencer.com/media/press_releases/planA/One_Day_Wardrobe_Clea
rout
IGD (2010). Retailer CSR Reports. Retrieved from
http://www.igd.com/index.asp?id=1&fid=1&sid=5&tid=127&cid=820#Tesco
Kotler, P. & Keller, K. (2006). Marketing Management, 12th edition. New Jersey: Prentice Hall.
Mesure, S. (2006). Ethical shopping campaign ‘is most successful in M&S history’. The
Independent. Retrieved from http://www.independent.co.uk/news/business/news/ethical-‐
shopping-‐campaign-‐is-‐most-‐successful-‐in-‐mamps-‐history-‐412899.html
Milner, T. (2010). “Which?” asks Governments for ecolabel simplification. Sustainable Life
Media. Retrieved from
http://www.sustainablelifemedia.com/content/story/brands/which_ask_govt_to_simplify_ecol
abels
Populus (2007). Concerned consumers’ summary. Retrieved from
http://extras.timesonline.co.uk/tol/concernedconsumer/ccs_march2007.pdf
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Wilkes, C. (2010). Marks & Spencer Launches Solar Energy Products. Retrieved from:
http://corporate.marksandspencer.com/media/press_releases/company/Solar_Energy_Product
s_Launch
Wilkes, C. (2010b). Marks & Spencer’s ‘Your Green Idea’ competition open for entries. Retrieved
from: http://corporate.marksandspencer.com/media/press_releases/planA/Your_Green_Idea