Media Analysis: Brand Spend Analysis - M&S may be a big spender but its ad campaigns have failed to entice shoppers

Christmas cheer was in short supply at Marks & Spencer last month. Having endured a share price slump, the retail giant’s sales in the run-up to the festive period fell 15 per cent compared with 1998 - marking the worst performance for 20 years.

Christmas cheer was in short supply at Marks & Spencer last month.

Having endured a share price slump, the retail giant’s sales in the

run-up to the festive period fell 15 per cent compared with 1998 -

marking the worst performance for 20 years.



Clothing sales remain depressed despite recent price discounting, and it

is not yet clear whether an increase in marketing spend - the retailer

advertised a post-Christmas sale for only the second time ever - will

turn things around in time for the formal release of its trading

figures.



M&S has already spent more than pounds 35 million on core advertising in

the year to November 1999, and the extra pounds 9 million it announced

it was spending in December makes it one of the UK’s largest

advertisers.



Financial services accounts for almost half of this activity, with a

spend of over pounds 10 million on direct mail and pounds 5 million on

press and inserts.



The successful financial services division advertises everything from

personal loans and life insurance to investment products, and accounts

for a growing proportion of the retailer’s profits.



M&S’s mid-market focus is reflected in its retail direct mail

advertising, where 60 per cent of mailings are aimed at 35- to

54-year-olds, and 40 per cent at the ’Suburban Semis’ and ’Mortgaged

Families’ Mosaic groups. Also, 70 per cent is sent to existing customers

- which is unsurprising given M&S’s Chargecard customer base - but it

sends out a lower proportion of acquisition mailings than rival

retailers.



The retail division pours most of its advertising budget into a mix of

press, outdoor and TV, particularly when it publicised the

post-Christmas sale. However, it has upped its spend on retail direct

mail significantly in 1999 to more than twice the 1998 level. This has

been a result of bringing all its products together in one mail-order

catalogue, which was promoted extensively in 1999.



Overall, M&S spends 43 per cent of its advertising budget on direct

mail, 14 per cent on outdoor, 34 per cent on press, 5 per cent on radio

and 4 per cent on TV.



Newspapers that picked up M&S ads include the Daily Mail, The Daily

Telegraph, the Evening Standard, The Express, The Independent and The

Guardian. Regional newspapers also picked up a big chunk of the pounds

12 million press spend with titles such as the Birmingham Post, the

Belfast Telegraph and the Leicester Mercury carrying a range of ads. The

magazine mix included Best, OK!, TV Times, Radio Times, Wedding & Home

and Woman’s Own.



What of the future for M&S? In order to boost City confidence, higher

advertising spend and radical product and price revisions seem

certain.



Increased spend on TV advertising is also likely as the retailer

embraces the medium for its financial services products and to promote

its sales effectively.





Research by AC Neilsen MMS, tel: 01344-627553 www.mediamonitoring.com.



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