Without proper e-commerce investment, Steve Rowe risks making Marks & Spencer fade into obscurity

 
Russ Shaw
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20th Anniversary Of First Online Sale
M&S has been playing catch-up with other more digitally advanced retailers (Source: Getty)

Ahead of Christmas, UBS analysts predicted that the retail winners would be those with the strongest online offering. As sales results from the holiday period get reported, the analysts are being proven right, with the most e-commerce and mobile-friendly retailers coming top of the pile in the festive fight.

This trend claimed it’s first victim this week, with the resignation of M&S’s Marc Bolland. The fall in sales announced yesterday reflects a stubborn trend for the retailer, stemming from below-par e-commerce.

M&S is no laggard – problems with its website and distribution centre in 2014 led to reforms that moved them forward. In fact, online sales were up 34.2 per cent in the first half of 2015. But it has been playing catch-up in an industry that is now being defined by digitally-led fast fashion, and the measures were not enough to curtail dropping sales.

A shift to a digital-first retail strategy is the only option if M&S wants to remain in this sector.

John Lewis’ record sales figures provide a stark contrast: the store’s online sales helped them shrug off fears of warm weather and heavy Christmas discounting from its competitors.

The group’s online sales have tripled over the past eight years and now account for 40 per cent of the chain’s total sales over the period. This resulted from a long-standing commitment to e-commerce, which has not slowed – the store announced a £500m investment in its online capability just last month.

From it’s efficient distribution service to its slick website interface, John Lewis is at the top of its tech game.

This commitment to e-commerce is precisely the mentality M&S should endorse if it wishes to dig itself out this sales slump.

Boland’s replacement, M&S lifer Steve Rowe, will be tasked with bringing the company's online offering up to speed as a priority. His depth of experience will be useful, but he will have to tear up the rulebook for how M&S does e-commerce if he is to make the retailer competitive in this area again.

Competition in UK retail technology is only getting hotter, with members of Tech London Advocates placing retail tech as the front-runner for the UK’s next billion-dollar company.

Successful retail tech businesses, such as Orpiva, Reward Technology and NotOnTheHighStreet.com continue to thrive, and Google’s Eric Schmidt has publicly stated that British retail technology is far ahead of the US.

Without making sufficient investment in its e-commerce platforms and customer experience, we risk seeing M&S, one of the UK’s most loved household names, potentially fade into obscurity.

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