Comparing_and_Contrasting_Marketing_Activity_of_Marks_and_Spencer’S___Waitrose

Comparing and Contrasting Marketing Activity of Marks and Spencer’s / Waitrose In this report I will be reviewing the activities of two organisations that are competing in a particular market within the equal marketing sector, and investigate their respective marketing activities within two organisations that I have chosen to review on, and they are Mark and Spenser’s along with Waitrose, I will be focusing on the differences in the marketing activities in terms of market place and position, target customers, products and services, however I will only be looking at a product or a selection of products, in addition I will be looking at the pricings of the selected segment from each of the organisations, the ways in they use communication with both their customers, consumers and the relevant contemporaries of the two organisations. What is Marketing: Marketing is a management process responsible for identifying, anticipating and satisfying customer requirements profitably, the importance of marketing within business is very important as it clearly identifies the accurate customers in which an organisation need to work towards in obtaining their attention then working their ways to satisfying their wants and needs. Marketing also helps specify pricing, in terms of customers being satisfied or dissatisfied with the amount they are paying for certain product, marketing assists the value of a product or a service according to customers being satisfied. Below contains the detailed review of the two companies’ activities I will be analyzing... Both Marks and Spencer’s and Waitrose are organisation in which their customers visit to purchase their convenient goods. Waitrose and Marks and Spencer’s are mentioned to be direct competitors as both the organisations target the upper market. Marks and Spencer: Marks & Spencer is a major British retailer, with over 885 stores in more than 40 territories around the world, over 600 domestic and 285 international. Marks and Spencer’s are known to be the largest clothing retailer in the United Kingdom, as well as being an upmarket food retailer, and as of 2008, the 43rd largest retailer in the world. Most of its domestic stores sell both clothing and food, and since the turn of the century it has started expanding into other ranges such as home wares, furniture and technology. M&S achieved market share growth during the economic years 2004-2008, as you can see from the pattern of consumers trading up The company’s performance between the years 2005-2007 was also enhanced by the expansion of the Simply Food network, although from 2008 it was seen to be rationalised. Marks & Spencer (food): Sales as share of all food retailers in UK, 2004-08, Company Accounts and Annual Report/Mintel Waitrose: Waitrose is a supermarket in the United Kingdom. Waitrose is the food division of the British retailer and worker co-operative the John Lewis Partnership. As of January 2010, there were 225 branches across the United Kingdom. The company differentiates itself from competitors by offering high quality food and emphasising customer service. The Company has a Royal Warrant to supply groceries, wine and spirits to H.M.Queen Elizabeth II. From research it has been clearly specified that those who shop at M&S and Waitrose are categorised as being rich and upper classed, and those who can afford their quality goods. Waitrose succeeded in increasing and obtaining its market share extensively during the years 2004-2008, the growth in 2008 was in line with the food sector’s performance, which was going accordingly. The reasons could be because Waitrose had helped their customers in the tougher times of the economy by introducing more discount lines. Waitrose Ltd: Sales as share of all food retailers in UK, 2004-08, Company Accounts and Annual Report/Mintel One of the differences between Waitrose and Marks and Spencer’s would be their packaging, from research it has been identified that Waitrose do it really well however in 2009 Marks and Spencer’s have been ranked worst supermarket for packaging. From looking the data obtained from a survey it has been clarified that Waitrose had been given a score of 79% and Marks and Spencer’s 64% for customer satisfaction, this clearly indicates that the regular customers of Waitrose are happy with the products and services they are being offered, the same for Marks and Spencer’s but the scoring indicates that Waitrose are doing better than Marks and Spencer’s in satisfying their customers wants and needs. Overall Marks and Spencer specialize in providing food and snacks suitable partying and get together however mainly consumed by those who are classed as upper class. Market Place: The market place is based upon the 3 C’s, and they are customers, competitors and collaborators, the collaborators are known to be the suppliers, the distributors and the agencies involved with the organisation. Marks and Spencer's and Waitrose are both supermarket retailer, and are known to be competitors working along the lines serving customers according to their wants and needs. Waitrose is a supermarket in the United Kingdom. Waitrose is the food division of the British retailer and worker co-operative the John Lewis Partnership, they have a high status within the supermarket retailer. The market share for Marks and Spencer’s was marginally down reflecting the impact of the downturn, and our position in the market as the UK’s premium food retailer. Sales Growth: From looking at the sales growth for both the organisations in 2008-2009 it has been noticed that Waitrose are doing well in the market in terms of sales, over the past year Waitrose’s sales growth was 9% which is a difference of 8.6% compared to the sales growth of Marks and Spencer’s. Product both Organisations Merchandise: Products at Marks and Spencer’s: Marks and Spencer’s has developed into a multi-billion pound food retailer, they offers fresh products, groceries as well as ready meals, they also produce seasonal dishes, the food ranges at Marks and Spencer’s has helped Marks and Spencer’s boost up their revenue, their food is bringing more revenue than their clothing and home ware put together. Supermarket.co.uk Marks and Spencer’s have a speciality in offering a high quality food, they are specializing in ranges of modern British classics, 100% additive free ready meal dishes, seasonal handmade fair-trade foods, their foods also contain less than 3% fat which counts to under 400 calories. M&S also provide products produced by selected organic farmers so they can provide their customers with fresh organic products, M&S also make sure that they are providing with nutritionally balanced ranges of dishes. Products at Waitrose: Waitrose have become a favourite for their customers as they specialize in providing the convenient foods for the suitability of their customers. The products Waitrose provide with are meat and dairy, fruit and vegetables, bread, baked goods and groceries. Waitrose offer an organic range of meat including chicken, beef, pork and lamb, they also offer a wide range of products such as burgers, sausages and bacon, and from research it has been noticed that people find the meat products at Waitrose having the best flavours due to the fact that they are produced from organic farms. This is one similarity in which both Waitrose and Marks and Spencer’s have in common and it is that they provide their customers with fresh organic goods. The fruit and vegetables at Waitrose and Marks and Spencer’s are also organic, both the organisations have some ways said that organically grown fruits and vegetables tastes great and is more friendly for the farmland and the wildlife. Waitrose offer a large range of organic dairy products including milk, cheeses, butter, yogurt and cream, many of which come from small producers who have a wealth of experience. They also are very passionate about the food they supply. The organic milk used to produce our dairy products comes from animals fed on natural pastures, free from chemical fertilisers or pesticides. Another service both organisations have is that they both provide their customers with fresh organic breads with a unique flavour and taste, as they have combined the skills from organic farmers, millers and bakers. The food products that customers purchase from Marks and Spencer's and Waitrose are non-durable products that are consumed fairly quick, and overall they are products that are used often as a daily essential. Store comparison: From the data obtained by research it has been mentioned that some customers that visit both Waitrose and Marks and Spencer’s, that the environment is widely over bright and crowded, however environment in Waitrose is more comfortable, their counters are better designed and have their own expert staff to assist their customers with purchases as well as what to cook, some customers have also mentioned that the. The staff at M&S may be just as good, but the environment works against them. In Waitrose they have softly lit wine department, as well as a wine bar in some stores where you can relax with a drink and snack. But the problem with both the stores is that, when it comes to pay then customers have to queue up in very long queue. M&S OR John Lewis...which is the Britains best loved store' By Leah Hardy, 07th January 2010 http://www.dailymail.co.uk/femail/article-1241205/Marks--Spencer-John-Lewis--Britains-best-loved-store.html Customer Service: Both Marks and Spencer’s and Waitrose serve their customers with till, and at check outs, where there is a friendly environment with care and respect, however out of both of the organisations Waitrose and there partner John Lewis have won in terms of serving their customers, as on the shop floor of Waitrose store there always is a helping hand from their staff, whereas in Marks and Spencer’s it could take a little while before you can come across some help. The variety of stock and helpful staff at Waitrose has kept their customers, which is why they would go back to Waitrose for products and service with confidence. http://www.dailymail.co.uk/femail/article-1241205/Marks--Spencer-John-Lewis--Britains-best-loved-store.html#ixzz0h3MpS8bp Services: The additional services that Marks and Spencer’s and Waitrose have are that they give their customers the opportunity to shop online in the comfort of their own homes. They both also do home delivery as well, in January 2000, the online food retailer Ocado was launched with the John Lewis Partnership as a principal supplier and part owner. The Ocado service is only available in certain areas of Britain. Ocado uses a central warehouse to service their deliveries. In November 2008, the John Lewis Partnership transferred its shareholding, then 29%, into its staff pension fund. Waitrose also operates its own delivery service, Waitrose Deliver, which is only available in certain stores, delivering goods ordered through the Internet and serviced from the local branch. Some stores also deliver after customers shop in-store, branded as "Shop and drop". The Waitrose Deliver service also hosts the online ordering system for Waitrose's special order food and cakes service. Customers: Marks and Spencer’s and Waitrose are supermarket retailers that offer a wide range of products from customers to consume, the customers of both the organisation are both male and female, couples, single people and parents. However the customers are those who are rich and have a stable job so they can afford their expenses at Marks and Spencer’s and Waitrose. Those who are rich and are from the upper class are the regular customers at Marks and Spencer’s and Waitrose, as the prices are high, though Marks and Spencer’s are more expensive than Waitrose, Customer buying behaviour High Low High Complex Variety seeking Low Dissonance- reduction Habitual (inertia) The customer buying behaviour is based within the 4 types of buyer’s behaviour, as stated above complex, variety seeking, dissonance and habitual. From looking at the convenience foods, sold by Marks and Spencer's and Waitrose, their customers would have a variety seeking behaviour at occasions, however the regular customers would have a habitual behaviour, as they will be purchasing their daily essentials, and they would not need to develop much assumptions on if the products would benefit them for the future or not, customers making purchases at Marks and Spencer's and Waitrose do not need to go through the decision making process as they know what they need as part of their essential needs. Market Segmentation: • Measurable • Accessible • Homogeneous (within the segment) • Clearly defined benefit sought • Sizeable • Heterogeneous (compared with other segments) Market Segmentation Marks and Spencer’s: Market segmentation allows M&S to treat similar customers in similar ways, whilst distinguishing between dissimilar customer groups. M&S uses demographic segmentation to select its target markets for its products (focus strategy). M&S targets its customers by age, income, social class, and occupation. M&S targets the 30 plus age group with high income and executive occupation. M&S also bases its market segmentation through value. The segmentation technique has helped both Marks and Spencer’s and Waitrose recognize the different types of customers, who will be interested in the products, services and activities provided by both the organisations, it has helped them identify those who be interested and will respond to the activities. One of the advantages of gathering information as such, is so that they know for definite that they will be making profit, by providing products and services, beforehand. Targeting Researching and marketing has helped Marks and Spencer’s and Waitrose target their main audience and customers, it has helped them produce the right products for the right people, as, if they don’t, they will not be able to find what customers want and will be most interested in, and who the product they produce will be most suitable for. Positioning On the types of research which Marks and Spencer’s and Waitrose have undertaken, it has helped them to position their products, promotions and brands with the suitability of their consumers; it has helped them develop their brand, products and promotions, so that it doesn’t have an impact on their business and so that they generate a positive response from their customers. Both Marks and Spencer’s and Waitrose, have thought about the positioning of their products and services after analysing their target market and the objectives to what they would achieve to, the aims of Marks and Spencer's food and Waitrose where to provide their customers with non-durable goods of satisfaction to satisfy their customers wants and needs. Positioning on attributes and features are common ways to position to differentiate their products from other brands, such as their logo. Communication: In November last year, Waitrose was the first grocer to launch an e-zine - Waitrose Seasons Live - which is an online version of its Seasons recipe magazine that is available in stores. Waitrose director for marketing and brand development Rupert Thomas says it is the perfect way to "deliver its content to a much wider audience, with the ability to talk to both new and potential Waitrose customers in a format that is relevant to them". With about 55,000 readers per issue and archived issues receiving about 200 hits per day, it has proved to be a popular addition to its site. Importantly, online technology means that digital content enables greater interaction through the use of videos, games, podcasts and so on. Waitrose provides video clips with step-by-step demonstrations of how to make the dishes. Its present edition has a clip of Waitrose executive chef Neil Nugent talking about top tips for outdoor cooking, as well as one of Waitrose's farmers talking about his seasonal lamb. How retailers are using customer magazines in print and online, 10 Aug 2009 BY Charlotte Hardie. Place: The places in which the Marks and Spencer’s and Waitrose store are located are from researching on the target audience around the location of the store, as they would need to consider in their customers not travelling a lot or a long distance to get to the supermarkets. All points at which people make purchases, the place where this can be obtained from is most important, as it is all about enabling the purchase to happen, in addition it is much more than simply the points of purchase the process of this so Stock control, warehousing, transportation, retail, order processing, customer enquiries and returns and delivering the convenience. Swot analysis for Marks and Spencer: Strengths Weaknesses • understanding of customer preferences and trends • Provide highest standards of quality • Suppliers use the most modern and efficient production techniques • supplier control, merchandise and store layout Marks and Spencer's have always used British suppliers, believing that it would give them highest quality with low costs but actually sometimes made them weak to challenge their its competitors whereas some of their competitors are using overseas suppliers to keep the costs down Opportunities Threats M&S have a wide opportunity to go more global to improve and expand their business. M&S is also in threat from Tesco and Sainsbury’s who moved into offering added value foods, which had been pioneered by M&S Swot analysis for Waitrose: Strengths Weaknesses • Own Labels “Perfectly Balanced”* • Work Delivery Scheme • Fresh/ Quality Food (own farms)** • Wide Range of products** • Additional Service, such as delivery, online, e-zine • Online-Shopping • Expansion is difficult due to existing store coverage • Very dependant on the performance of own labels Opportunities Threats • Retail Partnerships, as they are in partnership with John Lewis they have a better support, and the opportunity to expand. • Internet shopping (ocado.com) • Further exploiting the Non-food sector • Cheap-chains targeting the high end market • Overseas groups entering the market • Manufacturers are still seeking to legally slow down the penetration of own brands Recommendations: From analysing the performance of both the organisations Marks and Spencer's and Waitrose, it has been noticed that Marks and Spencer's have been falling behind in achieving the full acceptance from their customers, however Waitrose have done well, Waitrose achieved 8.9% more sales growth than Marks and Spencer’s from within the last years. The recommendations that I would like to point for Marks and Spencer’s so they can be more active in growing their sales would be to reassess their target market and identify their demands, identify the products mainly needed in the market and make improvements such as lowering the pricing schemes or categorise a better and more necessary promotional needs. According to the performance of Waitrose, it is known to be well positioned in their market segment. Waitrose have made a good progress with the setup of an online shopping facility. As Waitrose are doing well in the market they should continue within however considering in mind their customers. For future achievements within growth I recommend a mix of market- and product-development along with a constant high standard of products, and as they are in partnership they have the support of expanding their business into the north-west of the UK and or even an expansion into the non-food sector. Environmental fit analysis, Waitrose, December 2002, by Andidas.com Conclusion: Marks and Spencer’s have used many different types of marketing strategies to satisfy their customer wants and needs, as it has helped identify their target market, Marketing has helpd marks and Spencer’s and Waitrose specify pricing, in terms of customers being satisfied or dissatisfied with the amount they are paying for certain product, marketing assists the value of a product or a service according to customers being satisfied. The processes has also helped classify and understand the buyers behavior towards their products and service, which has helped Marks and Spencer’s & Waitrose make developments and improvements according so they are sure to be making profit and satisfying their customers wants and needs. In the past Marks and Spencer’s may have made mistakes regarding the important marketing variables, for example: the target market segment, the merchandise mix, the promotional needs, the degree to which products would need to be altered for the market, pricing and packaging as well as the distributional differences. Marks and Spencer’s did lose out a little on the sales growth this may have been because of the economical pressure; however with Waitrose it did not have such an impact as they had made an approach of launching discount lines and additional promotions. The M&S food range is typically seen as a special occasion purchase and the stores are generally not used as a destination for a full weekly food shop, whereas Waitrose have the ability to provide consumers with the weekly essential. However Marks and Spencer’s has been able to maintain a popular lunchtime sandwich offer, and this could enhance the competition in the years to come as a result of the agreement between Waitrose – which has a similar market positioning to Marks and Spencer’s. References: Environmental fit analysis, Waitrose, December 2002, by Andidas.com How retailers are using customer magazines in print and online, 10 Aug 2009 BY Charlotte Hardie. http://www.dailymail.co.uk/femail/article-1241205/Marks--Spencer-John-Lewis--Britains-best-loved-store.html#ixzz0h3MpS8bp M&S OR John Lewis...which is the Britains best loved store' By Leah Hardy, 07th January 2010 http://www.dailymail.co.uk/femail/article-1241205/Marks--Spencer-John-Lewis--Britains-best-loved-store.html Supermarket.co.uk Waitrose Ltd: Sales as share of all food retailers in UK, 2004-08, Company Accounts and Annual Report/Mintel Marks & Spencer (food): Sales as share of all food retailers in UK, 2004-08, Company Accounts and Annual Report/Mintel Marketing an introduction,Masterson and Pickton,