M&S in trouble, chief executive deploys doublespeak
Marks and Spencer, colossus of the UK underwear market and home of the £4 bag of carrots, is having a hard time, and is discounting prices so that people will go back to buying things they don’t need with money they don’t have, just like in the good old days. Just-knighted M&S chief executive Stuart Rose was interviewed (audio clip here, .ram format) about all this on the BBC Radio 4 Today Programme this morning, where he explained to Sarah Montague that M&S doesn’t engage in low retail tricks like using discounts to increase sales:
ROSE: … we reduced our opening prices by 6 percent … you have to run very hard to pick up the 6 percent deflation …
MONTAGUE: If you have to discount by 6 percent to get this fall -
ROSE (interrupting): It’s not discounting, Sarah, it’s positioning yourself in the market as a retailer that offers value.
So there we are. The likes of Tesco and Sainsbury’s may cut prices, but Marks & Spencer positions itself in the market as a retailer that offers value.
Speaking of value, much was added to the interview by the fluent and incisive commentary of business editor Robert Peston: ‘Well I think, this is, you know, an important moment, Marks & Spencer is the market leader in clothing, this is, you know, a a a a disappointing performance, and what you have to decide if you’re looking at it from from from from my perspective is, is this because Marks & Spencer itself has made a mess of it or is it because the market is really difficult. … Well, I think, you know, the the the the the the big question er for Marks & Spencer is really whether or not, you know, the the the the the the the the business is strong enough to weather this.’
Sir Stuart’s words did M&S no end of good: their shares plunged 18% in the first two hours of trading this morning.
