What is Customer Demographics and Target Market of Marks & Spencer Group Company?

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Who are Marks & Spencer's customers?

Understanding customer demographics and target markets is paramount for any retail giant. For M&S, this insight has been a cornerstone of its ongoing transformation and market success. A pivotal shift for M&S has been its aggressive push into digital channels and a concerted effort to attract younger demographics.

Founded in 1884, M&S initially focused on a broad customer base, emphasizing quality and accessibility. Over time, the company became known for catering to a more mature demographic, typically aged 45 and above, who valued reliability and classic styling.

M&S is now actively broadening its appeal, with recent market trends indicating a strategic shift towards attracting younger customers. This includes a focus on contemporary fashion lines and increased social media spending, aiming to be 'more relevant, to more people, more of the time'. This evolution is crucial for future growth and relevance in the dynamic retail landscape, influencing everything from product development to marketing strategies, including how they analyze their Marks & Spencer Group BCG Matrix.

Marks and Spencer Group has historically focused on a mature demographic, typically consumers aged 45 and above, with mid-to-high incomes who appreciate quality and classic styles. The company is actively broadening its appeal to include a wider range of consumers.

Traditional Core Customer

The established M&S customer profile centers on individuals aged 45 and over, often with a mid-to-high income. This segment values superior quality and timeless designs across clothing, food, and home goods.

Expanding Demographic Reach

M&S now targets middle to upper-middle-class consumers, primarily 30 years and older, who are willing to invest in quality products. This strategic shift aims to capture a more diverse customer base.

Attracting Younger Consumers

Recent data shows a notable increase in active app users under 45, indicating success in attracting a younger demographic. This segment is a key focus for future growth initiatives.

Performance Across Sectors

In the 2023/24 fiscal year, M&S clothing and home sales saw a 5.3% increase, with menswear and womenswear performing strongly. The company's clothing market share reached 10.3% for the 12 weeks ending September 15, 2024.

The M&S customer base spans across clothing, home products, and food sectors, with a growing emphasis on engaging younger shoppers. This evolution in M&S customer demographics is driven by new product lines and market adaptation, as evidenced by August 2024 research indicating that Gen Z (18-24 year olds) perceives M&S as a more 'fun' shopping experience than older generations.

Key Customer Characteristics

Understanding Marks and Spencer's customer base reveals a blend of traditional loyalty and emerging appeal. The company's efforts to refresh its offerings are resonating with a broader audience.

• Value for quality and style
• Mid-to-upper income bracket
• Increasing appeal to younger demographics (under 45)
• Appreciation for food, clothing, and homeware
• Positive perception of M&S as a 'fun' shopping destination among Gen Z

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Marks and Spencer customers are primarily driven by a need for quality, value, and reliability across their product offerings. They also show a strong preference for health and wellness, convenience, and dependable customer service, especially within the food and clothing sectors. This M&S customer profile indicates a tendency towards brand loyalty and consistent purchasing habits.

Quality and Value Focus

Customers prioritize products that offer a good balance of quality and price. The company addresses this by highlighting comfort and practicality in its designs.

Health and Convenience

There's a growing demand for healthy options and convenient shopping experiences. The company's 'Dine-In' offer, for example, saw sales growth of over 40%.

Ethical and Sustainable Practices

Consumers are increasingly seeking ethically sourced and sustainable products. The company has responded by increasing the use of sustainable materials and expanding vegan food options.

Product Development Driven by Feedback

Product innovation is closely tied to customer feedback and market trends. In 2023/24, over 1,000 customer favorite food items were upgraded, and 1,300 new lines were introduced.

Appealing to Younger Audiences

Marketing efforts are tailored to engage younger demographics through platforms like TikTok and Instagram, showcasing contemporary fashion lines.

Leveraging Technology

The company is utilizing generative AI to enhance online sales, with plans to use it for 80% of its product descriptions to expedite listings.

The company's strategy involves reinforcing its reputation for reliability and value, as seen in the 'Value You Can Trust' campaign in 2023, which positively impacted clothing and home sales. This approach aims to solidify its position within the Marks and Spencer target market. In clothing, core products like denim have shown strong performance, with market share in womenswear denim growing by 4% in 2024 due to expanded fits and trend-focused styles. Understanding the Marks and Spencer customer base involves recognizing these evolving preferences and the company's efforts to adapt its product and marketing strategies accordingly, aligning with its Mission, Vision & Core Values of Marks & Spencer Group.

Key Customer Preferences and Company Responses

Marks and Spencer customers value quality, value, and reliability, alongside health, wellness, and convenience. The company actively responds to these needs through product development and marketing initiatives.

• Emphasis on comfort and practicality in clothing design.
• Introduction of 'everyday value' lines to cater to price-sensitive consumers.
• Increased use of sustainable materials and a wider range of vegan food options.
• Product upgrades and new line introductions based on customer feedback and market trends.
• Targeted marketing campaigns on social media to engage younger demographics.
• Use of generative AI to improve online product descriptions and sales efficiency.

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Marks & Spencer has a substantial footprint in the United Kingdom, operating a diverse range of stores from large retail parks to high street locations and smaller Simply Food outlets. The company has secured a significant market share, with M&S Food's in-store market share reaching 3.7% and 4.2% when including M&S on Ocado for the year ending March 30, 2024. In the apparel sector, M&S's market share grew to 10.3% in the 12 weeks ending September 15, 2024, indicating sustained growth.

UK Market Dominance

M&S holds a strong position in the UK, with its food division recently surpassing Waitrose as a preferred grocer for a key demographic, capturing a 4.03% grocery market share in the four weeks to November 3, 2024.

Clothing Market Share Growth

The company's clothing segment also shows robust performance, achieving a 10.3% market share in the 12 weeks leading up to September 15, 2024, a notable increase of 90 basis points.

International Operations and Strategy

Internationally, M&S operates across more than 50 countries through various models including wholly-owned stores, franchises, and joint ventures. The current international strategy is focused on expanding online presence and forging strategic partnerships in key markets such as India, Europe, Asia, and the Middle East.

International Performance and Future Focus

Despite a 10.3% decline in international constant currency sales in the first half of 2024, an international reset is underway to drive capital-light growth by leveraging franchise partners' infrastructure.

Product offerings are localized to cater to diverse tastes and cultural preferences, exemplified by the collaboration with Reliance Retail in India. M&S is also committed to enhancing its UK store network, with plans to update half of its stores to a renewed format by the 2027/28 fiscal year to support long-term sales growth. This strategic expansion and adaptation of its retail presence are key to understanding the Competitors Landscape of Marks & Spencer Group and its overall market approach.

UK Store Network Expansion

M&S aims to increase the pace of new store openings in the UK, with a goal for half of its store estate to be in a renewed format by 2027/28.

International Growth Strategy

The company is prioritizing online growth and selective partnerships in international markets, focusing on capital-light expansion.

Product Localization

M&S adapts its product assortments to align with local tastes and cultural nuances in its international markets.

Market Share in Food

M&S Food's market share reached 3.7% in-store and 4.2% including online sales for the year to March 30, 2024.

Market Share in Clothing

In clothing, M&S achieved a 10.3% market share for the 12 weeks ending September 15, 2024.

Competitive Positioning

M&S has become 'Middle England's favourite grocer,' holding a 4.03% share of the grocery market for the four weeks to November 3, 2024.

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Marks and Spencer employs a comprehensive strategy for customer acquisition and retention, integrating digital advancements with established retail practices. The company focuses on enhancing its online presence and leveraging its loyalty program to foster deeper customer relationships.

Digital Engagement and Online Growth

Significant investment in the online platform aims to improve user experience, with the M&S app accounting for 44% of online orders as of May 2024. The company is targeting online sales to represent 50% of its Clothing & Home revenue by 2028.

Loyalty Program and Personalization

The Sparks loyalty program is central to retention, offering personalized rewards and charity donations. M&S is enhancing this through data investment to create a more tailored customer experience.

Targeted Marketing and Promotions

Digital marketing spend, particularly on platforms like TikTok and YouTube, has increased by 79% year-on-year to attract younger demographics. AI is utilized for targeted advertising and efficient product listing.

Pricing and Availability Focus

While maintaining a premium pricing strategy, M&S employs strategic promotions during peak periods. The 'First Price Right Price' initiative supported full-price sell-through in Clothing & Home during 2023/24.

Enhancing Customer Experience

M&S is committed to improving product availability and fulfillment across all categories to meet customer needs wherever they choose to shop.

Attracting Younger Audiences

Increased investment in social media platforms like TikTok and YouTube signifies a strategic effort to broaden the M&S customer base and appeal to younger demographics.

Data-Driven Personalization

The company's focus on data and AI aims to deliver a more personalized shopping experience, ensuring that loyalty program benefits and marketing communications are highly relevant to individual customers.

Digital-First Loyalty

While the Sparks program is digital-first, M&S continues to offer physical cards upon request, ensuring accessibility for all members of its diverse customer base.

Strategic Pricing Approach

The 'First Price Right Price' strategy in Clothing & Home aims to build trust and encourage full-price purchases, supporting the brand's premium positioning.

Omnichannel Fulfillment

Improving availability and fulfillment across all channels is crucial for engaging customers and ensuring a seamless shopping journey, reflecting the evolving needs of the M&S customer profile.

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