M&S chief Bolland says results 'not good enough'
- 8 July 2014
- From the section Business
Marks and Spencer's sales performance in clothing and homewares is "not good enough", its chief executive has said.
Marc Bolland's comments came as he addressed shareholders at the retailer's Annual General Meeting.
Some shareholders expressed frustration at the time it was taking to revive the High Street giant.
Earlier on Tuesday, M&S reported its 12th consecutive drop in quarterly sales of general merchandise, with trading hit by problems at its website.
Mr Bolland admitted that issues with M&S's revamped website had had "an impact on sales", with online purchases down 8.1% in the latest quarter.
At the AGM at London's Wembley Stadium complex, one shareholder said: "This must be the slowest turnaround of a ship in history."
Another said M&S had forgotten how to produce goods "that appeal to the public".
The new website intended to transform the 130-year-old business but has faced obstacles since its launch in February.
All six million customers registered on the old site were forced to reregister, and there have been reports of problems with site navigation.
Last week, Laura Wade-Gery, who was head of M&S's online business, was promoted to oversee M&S's UK stores and some are tipping her to, one day, take over from Mr Bolland.
Problems with online sales contributed to a 1.5% fall in like-for-like sales of general merchandise in the 13 weeks to 28 June
However, the fall was offset by continued growth in M&S's food sales, which increased 1.7%.
Overall, UK like-for-like sales were up 0.3%.
The retailer said sales of womenswear increased during the quarter, but like-for-like clothing sales overall were down by 0.6%.
Mr Bolland said: "We have seen a continued improvement in clothing, although as anticipated the settling in of the new M&S.com site has had an impact on sales.
"We are pleased that the womenswear business was in growth, driven by full price sales, in line with our increased focus on margin.
"Our food business had another great quarter, continuing to outperform the market, through our focus on differentiation through quality and innovation."
Neil Saunders, managing director at retail analysts Conlumino, said: "The latest update from Marks and Spencer tells an old tale: that the strategy on clothing will deliver results if only it is given more time.
"There may well be some merit in this story, but it is one that can only be spun for so long before it becomes incredulous."
Keith Bowman, equity analyst at Hargreaves Lansdown Stockbrokers said: "Against a backdrop of low expectation, M&S appears to have offered some hope.
"For now, M&S remains a work in progress. The group's offering continues to be honed, food sales are expanding, bolstered by the roll-out of new Simply Food stores, whilst the strength of the group's brand name and the still attractive dividend yield cannot be forgotten."
Many readers have been in touch to comment on their experience with the revamped M&S.com.
Laura Ann McCarthy said: "I have tried using the new website and I have found it incredibly difficult and frustrating to use. I regularly shopped online at M&S before but I have not bought anything since the launch of the new website."
Ronbo from Lancashire emailed: "The old M&S website may not have been flashy but it was a masterpiece of clarity. In seeking to emulate retailers like Next, M&S have produced an over-complicated user interface that spends most of its time "selling at" the consumer rather than responding to their requests".
Jerry Sanders, an independent internet analyst, said that successful websites should not require too many steps before purchasing. He recommends simple search bars to find an item, followed by a "buy it now" button.
He said: "Three pre-purchase interactions are just about tolerable - four or more and the sale will likely be lost to a competitor's site.
"As the spending power of the social media generation becomes more and more influential old-style websites requiring several layers of navigation are running into problems."
Daniel Booth, editor of Computeractive said: "M&S can't expect the High Street loyalty they enjoy to automatically translate online, and they risk losing the next generation of web-savvy shoppers if their website is substandard".