M&S ‘praying for sun' but full recovery from cyber-attack unlikely this summer
As UK temperatures rise over the coming week, M&S will be hoping it prompts shoppers to fill their virtual baskets with shorts, swimwear and sandals to get its summer sales back on track.
After six weeks of costly disruption as the result of a cyber-attack, the retailer started taking internet orders again on Tuesday, making a selection of its fashion ranges available for standard home delivery in England, Scotland and Wales.
However, the partial resumption of online services does not mark the end of the website woes. Shoppers in Northern Ireland were told they would have to wait a little while longer before theycould place orders, while click-and-collect and next-day-delivery services would only become available again in the coming weeks.
Retail analysts were unsurprised that the UK's biggest clothing retailer had prioritised getting fashion back online before beauty and homeware, given the limited time M&S has to sell seasonal stock.
'They will be praying for a hot summer so people keep buying summer clothes,' said Catherine Shuttleworth, a retail commentator and the chief executive of Savvy Marketing. 'Now they have got to get their operation up and running, but things are in the wrong place. I think the challenge is that not a lot is online in the right sizes.'
There was clearly pent-up demand for M&S clothing among loyal customers, judging by excited comments shared on social media and among friends in Whatsapp groups when the retailer announced it had restarted online orders.
However, that delight soon turned to disappointment, as shoppers were informed they would have to wait up to 10 days to receive their order. Others discovered the items they had been coveting were out of stock.
'I attempted to order some jeans last night, but by the time I finished adding things to my basket, my size was gone,' said Kirsten Jones, a customer. 'Stock is pretty low, I think I'm just going to wait until business is back to normal.'
M&S has already said its six weeks of lost sales will prove costly – and has estimated it will take a £300m hit to profits this year as a result of the cyber-attack. The incident began over the Easter weekend – too late in the year for the retailer to cancel orders for its spring and summer clothing ranges with its suppliers.
M&S could have lost up to £130m in online clothing sales during the period its website was down, according to an estimate by the data firm GlobalData.
Some customers may have heeded the chief executive Stuart Machin's plea to visit its physical stores during the online switch-off, but it is unclear how much of the spend shifted to shops or how much was lost to competitors, given that not all customers would have been able to visit a branch or may have found insufficient stock on the shelves.
With its supply chain thrown into disarray by the attack, lack of availability continues to dog M&S in store.
Clare (who did not want to share her last name) was looking through the racks of summery outfits at M&S's Stratford branch in east London on a weekday morning. Eyeing a new pair of shorts for an upcoming holiday to Mallorca, she said she could not find many in her size.
'I usually browse online, but tend to shop in store if I'm nearby. I've not been able to find my size in store for a few weeks, and even now I'm struggling,' she said.
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M&S's stores play a crucial role in its online operations, and are involved in two-thirds of online orders, through customers either picking up or returning purchases. As a result, getting all services working again is a key milestone for the retailer, according to Clive Black, the head of consumer research at M&S's broker, Shore Capital.
'They need to get click and collect back up. They need to get [their hi-tech distribution centre] Castle Donington working. They need to get the full assortment online,' said Black. 'It may be August before you actually see a normalised M&S clothing offer in store and online.'
Tuesday's online restart came just as many rival retailers were launching their summer sales, giving shoppers the chance to pick up bargains elsewhere at a time when retail sales and spending data suggests consumers are watching their wallets and cutting back on purchases.
Analysts say M&S will need to hold its nerve to try to recoup some of its lost earnings.
'They will probably try and stay at full price initially, at least, to get that money back. But I'm assuming they have a lot of excess stock, so they will eventually need to start discounting more to get through some of that, as they won't be able to keep selling more seasonal summer items,' said Pippa Stephens, a senior apparel analyst at GlobalData.
M&S was hit by the cyber-attack just as its bosses were seeing the fruits of their turnaround plan, having gained market share in both food and clothing last year, while the company's shares hit an almost nine-year high in April.
It may take the high street stalwart some time to rebuild trust with shoppers after the attack, which involved some personal information relating to thousands of customers being taken. However, M&S shares are moving upwards again and its clothes are winning plaudits from fashion commentators.
'I think M&S's summer was already damaged, and they will want to see the back of it,' said Shuttleworth. 'What they are doing now is to get the business right so that back to school means back to normal
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