MARKS & Spencer’s ninth consecutive quarter of falling sales is set to put further pressure on CEO Marc Bolland, who has argued that recent improvements to the fashion business have been “well-received” by customers, but that high-street spending has yet to catch up with the wider economic recovery.
So is this an economy problem, or an M&S problem? According to our research, it’s a bit of both. YouGov’s Household Economic Activity Tracker shows that consumer confidence is up almost 15 points from January. But while confidence is rising with GDP, consumer spending – particularly in retail – is not.
The amount the average consumer reports spending on clothes and shoes is virtually unchanged: It was £64 per month at this time in 2011, £66 in 2012 and just £63 today.
Only 13 per cent say they intend to spend more on clothes and shoes over the next 12 months. When we ask people what they would do with an unexpected windfall equal to one-month’s income, a majority say they would save it, a third would use it to repay debts – and just 16 per cent would spend it.
In addition to these lacklustre figures Bolland’s new strategy has failed to excite. As I reported last month, there was an uplift in consumer perception following the release of the Leading Ladies campaign.
However, purchase intent for M&S has risen by just one point (to 24 per cent) since the campaign began, and is now flat-lining.
Stephan Shakespeare is the chief executive of YouGov