History Of The Blue Harbour Brand Marketing Essay

History Of The Blue Harbour Brand merchandising EssayIn 1884 Michael mark, a Russian born Polish refugee capable a st every at Leeds Kirkgate grocery store. Since and so, attach and Spencer was born, opening over ccc stores worldwide and overly being the UKs largest clothing seller.In 1999, online shopping was introduced to their website for customers to jazz in the comfort of their declare home. The internet had scarce started to become know and more and more passel were staring to map it, so label and Spencer in like mannerk this opportunity and set this up at the correct time.In 2000, MS brought divulge their level-headed Count on us range, for the healthier race on diets or who were just watching what they ate.Their 1st Simply provender stores opened in Surbiton Twickenham in 2001, selling nonhing but healthy diet, no home furnishing or clothes uniform the normal stores.They overly launched Per Una a brand of clothing specifically targeting the fashion-co nscious women. Shortly after in January 2001, Blue Harbour was introduced, a casual wear brand for males. realise number and DB07 another brand of clothing was introduced in 2002, View form for sportswear and DB07 for children designed in collabo ratioalityn with David Beckham.Mission Statement mark and Spencers throw offion assertion is broken into 3 parts which include mess To be the standard against which others atomic number 18 measuredMission To make aspirational prize accessible to all andValues Quality protect, service, mental home and trust.This mission pedagogy has been kept up since the start of making it MS direct worked stern to achieve all these factors. Even though on that point take away been ups and downs during the historic period they have tried hard and have kept to their word. in that location are more companies which look up to MS and measure themselves against them, helping their alliance to improve and gain more customers. mark and Spencer s have been known for their tone value, service, innovation and trust to all their customers who as a come with they have stuck to very wholesome. They are continuing to attract new customers as well as delivering their old ones, offering them new and improved products all the time.ObjectivesEvery year MS had many objectives which were to be met, they were not in truth split into long term and short term but just objectives as a whole for each coming year.In 2001, they had many objectives but their main ones were attracting new customers, developing stronger relationships with their suppliers, aim for market place leading and in any case to restore the heart of MS, stop non-core and profit losing activities and also to keep an effective balance sheet calling these 3 sectors their fundamental specialnesss.In 2002, not only did they want to develop stronger relationships with suppliers but also to progress on a unique relationship with their customers. They needed to keep r ebuild on their fundamental strengths, continue to regain market leadership with value, step and also appeal.It was aimed for MS to open their 1st standalone home store in spring 2003, also to improve every aspect of their smart set, overcome the emulation and continue to attract more customers to their stores.Before 2004, the MS fundamental strengths were changed, which include improving the management team, still ensuring the balance sheet was effective and also delivering impactful but low cost improvements.In 2005, MS only wanted to re accent on their core values in their employment which is quality, value, service, innovation and trust.Pestel AnalysisIn this section a PESTEL depth psychology will set out place and will look at the external factors that impact on Mark and Spencers performance.PoliticalAccording to the mark and Spencer website there are constraints on out of town shopping has been but in place by the governance. This is cavictimization problems for M and S. This is be stir it is soaringly pricey for retail stores to be in the centre of large towns and cities with all the business rates and M and S is not selling enough produce to break heretofore with these special expenses they have to pay for being in the centre. MS is nerve-racking to fail some of there stores out of the centres but with constraints it is causing problems for them. The UK not having the Euro is functional as a disadvantage to MS in relation to there western European store because MS products are too expensive as there are being sold at UK prices. efficientThe UK economy and currency is relatively strong compared to other countries so the strength of the pound is working as a disadvantage to tag and Spencers in the UK and abroad. (www.bitc.org.uk)Current world events have affected global economies, which may expiry in fluctuations within the industry. This may lead to unpredictable consumer and supplier behaviours.sociologicalMarket trends are constantly changing and Mark and Spencers have ever refinementingly struggled to keep up with them. For example, Life style changes have made people more aware of their health, which has resulted in higher demand of quality health care related products. People are concerned with value for money.Consumers are concerned with their image, for example they moldiness have the latest labels.The population in the UK is ageing and with this, more people have a higher fluid income.TechnologicalInternet shopping has lead to international purchase opportunities, which path the consumer has an enormous amount of options when it comes to shopping. This means that the competition has also increased, but tag and Spencers hatful use it to their advantage to support new products and help to come out that Marks and Spencers is an up to date ships attach to. (www.marksandspencers.com)EnvironmentalMS is restricted to where they cornerstone build its stores because of the restrictions on Brown field site s and Green field sites. MS bum only build on Brown field sites hagfish restricts them to having to stay in urban areas with competition.LegalThe government is constantly redefining avocation laws, which enables Marks and Spencers to trade for longer hours, for example longer shopping hours on a Thursday. Marks and Spencers must follow advertising laws which are stead in place to protect the consumer, but also to promote sportsmanlike competition amid companies.SWOT AnalysisThe Swot analysis looks at a companys strengths, weakness, opportunities and panics which are likely to have an impact on the companys performance.StrengthsMarks and Spencers has been running since 1884 and has a good traditional reputation especially with the onetime(a) generation. Marks and Spencers is also one of the biggest retailers on the high street having stores in most cities and large towns and with thirty other stores across the globe. (www.marksandspencers.com) The brand recognise is known in nearly every house hold. Marks and Spencers has a diversity of products such(prenominal)(prenominal) as food, underwear, menswear children wear, women wear and furniture.WeaknessesFashions are constantly changing and Marks and Spencers has an inability to keep up with changes in the retail market. in that location are also problems with focusing on the right targets markets in foothold of products and customers. (www.bitc.org.uk)Many consumers still feel that Mark and Spencers products are old make and out dated compared to competitors. Even though this is some thing that Marks and Spencers is constantly trying to change.Marks and Spencers is now experiencing paltry performance across the globe which has resulted in the pull out of foreign operations.OpportunitiesMarks and Spencers has the opportunity to collaborate with other companies to widen up product range even more. They could also collaborate with designers to help bring new ideas, and help hit the roof on their furn iture and beauty products.ThreatsThere is constant competition from competitors such as John Lewis, Debenhams and Next. And especially from younger clothing competitors such as refreshed Look.Ever changing fashions trends which Marks and Spencers struggle to manage is grueling Marks and Spencers performance.Gap analysis and RatiosA gap analysis involves identifying a gap or weakness in a specific company and looking to bridge that gap in align to meet a target objective as to where the company wants to be.The following quote helps to hike up identify a gap analysisGap analysis, consists of defining the redeem state, the desired or target state and hence the gap between them. In the later stages of problem solving the aim is to look at ways to bridge the gap definedwww. Ifm.eng.cam.ac.uk January 23An example from Marks and Spencer is there downfall in the womenswear market, which in 2004 fell 0.6% to a 10.4% share of the market. ambition in womenswear has increased dramatically with women demanding style, quality, outstanding value and real choice.In order for Marks and Spencer to reclaim this market share they set out a clear plan, this involved listening to customers better during store visits, focus groups, better use of market data and keeping a impendent eye on tracking trends, tracking competitors and also evaluating there own performance.From a purchasing point of view they looked to strengthen there buying teams, giving clearer responsibilities for design, buying and merchandising.The companies buying strategy changed to buy less, more ofttimes meaning better ranges and fresher lines of stock.It was also vital that Marks and Spencer didnt miss out on key trends like the previously did in 2003 such as with cardigans.In order to further close that gap Marks and Spencer learnt that they have to cater for particular needs and markets.For instance it is estimated that 42 % of womenswear brought is by women under the height of 5ft 3 inches, Marks and Sp encer didnt previously cater for these, oftentimes producing large, baggy clothing.Now Marks and Spencer have now produced a bantam range in 33 of its stores in order to cater for this market.The three ratios that were decided in order to assess Marks and Spencers financial position were the current ratio, railroad train ratio and return on capital use ratio.Firstly the current ratio can be work out by dividing current assets by current liabilities, this identifies how far a inviolable can meet its short term liabilities from its current assets without having to raise finance by borrowing, selling fixed assets or issuing more shares.A ratio less than one for a period of time is a cause for concern Marks and Spencers did have a healthy current ratio until 2003 but in the last couple of years they have swayback below one causing concern, whereas for example a competitive company such as Next has stayed consistent for the last 3-4 years.Secondly the gearing ratio can be calculat ed by total borrowings x 100 % and then divide by the capital employed.The ratio shows the proportion of capital employed, which is financed by borrowed capital.The relationship between some(prenominal), ought to be balanced with shareholders funds world-shatteringly larger than the long term liabilities in order to have a health gearing ratio.The higher the gearing ratio, the higher the jeopardize to the company is, as high levels of borrowing represent a significant risk to the company.In 2004 Marks and Spencers was sky high, massively bigger than that of competitors Next.The last ratio analysed was the return on capital employed, this can be calculated by Operating profit x 100% and then divided by capital employed.The ratio is an important indicator of how efficiently the business is being managed.As a rule if a company has a low return on capital employed then it is using its resources inefficiently even if the profit margin is high.In the years 2004-2005 both Marks and Sp encers and Nets ROCE have been high indicating a healthy return on capital employed.Five force analysisPorters five forces model (below) can be used to help make an analysis of the competitive purlieu for a company within a certain industry. In this case, it is Marks and Spencer in the food and clothing industry.Source Adapted from Porter, M, (1998) Competitive strategy, New York, free pressQuickMBA, Strategic Management (1999) states thatThe strategic business double-decker seeking to develop an edge over rival firms can use this model to better understand the industry context in which the firm operates.The threat of new entrantsThere are a variety of major companies in the market such as Next, Debenhams, Sainsburys and Tesco with regards to selling clothing and food products. These are well known companies which are strong in the market so the threat of new entrants is low. A company such as Marks and Spencer (MS) has a strong brand name which therefore creates a barrier to ent ry for potential new entrants. Companies would probably experience high start up losses in an attempt to try to promote its products in terms of trying to prise allegiant customers away from MS.There is the threat however of company take over where one company buys another one out. Examples include Morrisons taking over Safeway and Walmart taking Asda in bids to try and create better companies without having to build many stores around the country. The government is also keen on new businesses starting up in the market to try to discourage a monopoly situation negotiate supply of suppliersMS has over 2000 direct suppliers where 1500 are for clothing and 500 for its food. Marks and Spencers corporate site online (2005) states90% of other products are now sourced overseas. afield suppliers provide plenty of choice for MS and also cheaper labour.The market that MS is in also makes it easier for the company to bargain with their suppliers because there are many suppliers which provide clothing and food which are relatively undifferentiated so MS can go to another supplier if they feel there are better suppliers to go to as opposed to their current ones.Bargaining occasion of buyersThere are many clothing and food companies to use up from in terms of the consumer so it is the consumers who can dictate the price by demanding quality products at good prices. Clothing and food are not specific items unlike a Ferrari sports car. Food and clothing are quickly available to everyone and so therefore it is important for a company like MS to offer quality goods at right prices in order to compete in a very price orientated market. With a Ferrari sports car, it is a very prestigious item and therefore prices are not as important for Ferrari. MS therefore needs to add value to their products such as the Autograph range of clothing launched in 2000 whichThe threat of substitute productsIf a product from a different company is cheaper then consumers may switch to that prod uct. If there are low switching be e.g. substitute products are much cheaper than MS ones then there could be more consumers switching to the cheaper product. For example, a pair of jeans in MS is 25 but in Primark the jeans are6. There are many retail stores selling clothes which are competing with MS and therefore could act as substitute products. To counteract the threat of substitutes, MS must concentrate on ensuring absolute product quality and customer service to keep loyal customers.The intensity of rivalry amongst existing competitorsThere food and (especially) the clothing market has fierce competition and MS must compete with companies such as Next, Debenhams, Tesco and Sainsburys for selling both their food and clothing products. These companies are all trying to obtain the largest market share possible in the retail sector. proofOverall, MS (Marks and Spencer) have established themselves over 120 years as a well known high street name. The mission statement that has bee n created by MS, highlights that the company aims to be the standard to which other companies look too in terms of retailing. The objectives highlight on continuously improving the company (objectives in 2005 focused on the core values of the business). The SWOT analysis shows that MS is a very well known company although is poor at keeping up with fashion changes and therefore must be wary of changes and regard them as a threat.The five force analysis shows intense competition within the industry with big companies such as Next and Debenhams selling clothes and Tesco and Asda selling clothes and food. MS must be wary of substitute products with stores such as Matalan and Primark offering these products and also MS must recognise that the customer has high buyer power as they have the choice of many retailers at different prices.