QUESTION
Write 4500 Words Research Proposal
Topic :: MARK AND SPENCER – FACING COMPETITION FROM NEW AGE RETAIL SERVICES
MARK AND SPENCER-FACING COMPETITION FROM NEW AGE RETAIL SERVICES
Abstract
New age service in retail sectors has influenced the market behaviors as well as performances of different companies. This study has highlighted the impact of such introductions on the organizational performance of M&S. In this context, it has illuminated the performance of M&S considering changing market trends. Impact of new age service in UK retail sector of performance of M&S has been considered as problem statement. Different factors have been highlighted as a part of creating market competition. In this aspect this study has focused on current trends, cost of the products and quality. Challenges of such practice of new age services have been highlighted. The researcher has applied positivism philosophy and descriptive design and deductive approach to reach at the conclusion based on observation of factual data and analysis of collected data based on theoretical framework. Through interview and survey primary data has been collected, where as secondary thematic data has been considered in terms of existing data considering impact of new age service on organizational performance of M&S. The study has resulted that new age services have influenced market trends as well as customer behavior which also influenced organizational strategies.
Acknowledgement
I would like to thank each and everyone who have aided me in this research project. Firstly, I would like to express my gratitude to my professor who has guided me throughout the conduction of the research. Secondly, I would like to thank my family and friends who have provided all kinds of help to be. Thirdly, I want to thank all the employees of the company, M&S who participated in the survey session and interviews as a part of my data collection process.
Thanking You,
_________________.
Chapter1: Introduction
1.1 Introduction
This study will focus on current level of competition faced by M&S due to increased competition from different new age retail stores. This chapter will include discussion different competitive factors for a retail industry in the context of M&S.
1.2 Background
Marks & Spencer is one of the biggest retail store in UK facing some serious threat from Uniqlo, Tommy Hilfiger, Gap, Zara and different other new age retail companies(Owler.com, 2019). Total revenue of M&S was £10.7 million in the year 2018 and gross income was £3.41million which is much lower than the previous year (Marksandspencer.com, 2019). M&S is planning to close a huge number of stores due to fall in profit in year 2018. Mark and Spencer are currently facing challenges due to high price of their products and poor innovation as well as lack of product variation. These factors are increasing the market challenge and competition of the company.
1.3 Rationale
Currently M&S is facing challenges due to increased competition level in the retail industry of UK. Serious issues like poor quality of stores, high price rates and incorporation of new strategies by different competitive brands cause significant fall in overall profit rate of the organization (Theguardian.com, 2019). At present different new age competitors like Hilfiger, Zara, Primark, Monsoon incorporates new business strategy so the competition level increased in the retail industry (Nytimes.com, 2019). This study will shed light on different competitive factors regarding increased competition level in the retail industry of UK.
1.4 Aim
This study is aiming to critically evaluate the level of competition faced by M&S because of the changes introduced by new age retail services.
1.5 Objectives
-
To identify the competitive factors for retail industries that influencing M&S
-
To critically evaluate strategic changes introduced by new age retail organization
-
To critically discuss level of challenges faced by Marks and Spencer by new age retail services
-
To develop critical strategies for M&S to resolve challenges from new age retail services
1.6 Questions
1. What are the main competitive factors of retail industries that influencing market competition of M&S?
2. What kind of strategic changes introduced by new age retail organizations?
3. What is the current level of challenges faced by M&S because of generation of new age retail services?
4. Which strategies can M&S consider in order to mitigate challenges from new age retail services?
1.7 Significance of the study
This study is focused towards critical evaluation of current level of competition faced by Mark and Spencer from various new age retail organizations. Retail industry of UK has been experiencing entrance of new companies. These are changing the terms of services offered by the industry. While these new services are changing the market behavior and customer trends in terms of changed services, it is also creating challenges for the existing company to match with the changing situations. It has been identified that current performance of M&S has been facing negative graph. This study is aiming to highlight impact of new age retail services on the raising competition of M&S.
1.8 Chapter summary
This chapter has discussed the background information behind the research topic. It has highlighted the problem statement by considering the issues. Based on that, it has developed aim and objectives of the research. This has also been considered regarding the development of research questions. Hence, it has prepared the framework for the research work.
Chapter 2: Literature Review
2.1 Introduction
This chapter of the study presents a comprehensive as well a critical study of the literary works considering various aspects of research topic. Different factors are responsible for the generation of market competition in retail industry. Along with that, entrance of new age services has changed the dimension of the service of retail industry. This part of the study critically describes such factors.
2.2 Conceptual framework
2.3 Critical analysis of competitive factors in retail industry
Analysis of important competitive factors is essential for an organization in order to improve their product and service quality. In context of retail industry, spotting current trend of the market is the most important competitive factor for an organization. As mentioned by Pandey et al. (2019, p.39), spotting current trend helps the organization to evaluate customer behavior during choosing a product and thus it will help them to increase product and service quality and skill development of workforce in order to improve productivity of the organization. Based on that, an organization can analyze preference of the consumers at the time of buying products. In addition to that, it can help the organization to improve their product quality and other factors. However, product cost is another important competitive factor for a company. As opined by Panigrahi et al. (2019, p.175), in the retail industry customers are always tends to buy cheaper products with better quality. In order to attract more customers an organization needs to maintain low cost as well as good quality comparing to others.
Technological advancement can be a major competitive factor in the retail industry due to implementation of new age modern technologies in order to improve overall productivity, skills of the employees, sales volume, and service quality. On the other hand, as stated by AlShamsi and Ajmal (2018, p.387), technology always affects every aspect in the retail market as huge influx of information or data can be most essential and valuable for the retailers in order to maintain their business structures. On similar note, as stated by Sun (2018, p.197), technology has changed the entire scenario of current retail industry because of increased use of AI, Internet, Big data and many other modern technologies. An organization needs to incorporate modern technologies in order to improve their marketing and other operational strategies to attract large target group of customers. Incorporation of modern digital technologies can help the organization to improve their production quality, skill development of employees and marketing strategies. Internal as well as external rivalry can also be a huge competitive factor for a company. Organization needs to have proper knowledge about their rivals and they need to know about the current state of the economy of the country in order to maintain their economic growth.
2.4 Critical evaluation of new age services in retail services
Currently in the retail industry of UK competition level has increased significantly due to increase in number of new age retail organizations. Along with that, as mentioned by Ismail (2018, p.3), due to incorporation of next-generation technologies retailers became more competitive. On similar note, as suggested by Zhang (2018, p.57), one of the important trends in current retail industry is investment into omnichannel retail strategies. Some research studies show that average online consumers own mostly 3.64 connected devices and they tend to consult all these devices before purchasing it. Main importance of these devices is to fulfill the demand of the consumers seamlessly. Some new age retailers are already adapting this mobile shopping technique in different innovative ways. They want to create innovative as well as unique shopping experience for consumers. On the contrary as mentioned by Chandra and Kumar (2018, p.67), another major trend in the current scenario is rise of personalization. Retailers of recent times mainly focus on creating personalized experiences with the help of simple services. This includes text messages which provide timely update on different orders, chat-bots which will increase customer interaction as well as engagement, tele-based or online communications, and many other technologies. New age retail organizations tend to incorporate Artificial Intelligence, Big data and many other advanced modern technologies in order to improve their services. Another emerging retail industry trend is providing seamless mobile payment apps because of the growing rate of consumer demand for payment methods which are more flexible. One of the most important trend in the retail industry right now is retailers are focusing on tapping new market areas globally. Incorporation of different modern technologies has made it easier for the new age retailers to reach target customers in international as well as emerging markets.
2.5 Critical discussion of competitive factors on organizational performance
According to Thorstein Veblen’s Theory of Business or Market Competition, different competitive factors have direct impacts on organizational behavior. In addition to that according to this theory different industrial arts helps to determine organizational structure. However, destructive competition can have negative impact on organizational performance due to lack of competitive performance, lack of appropriate knowledge about current market position as well as lack of knowledge about market competition. As opined by Kadhim et al. (2018, p.907), according to this theory growing rates of market competition can influence overall productivity of an organization and thus, it can affect the growth of the business. In addition to that this theory says that increased rate of unproductive consumption as well as eliminating destructive competition can help to assure profitability of the organization. However, it can influence the organizational environment.
2.6 impact of market competition on organizational behavior
Competition has been acknowledged highly for determining overall behavior of an organization and overall performance of it. Along with that, as opined by Ahmed (2018, p.579), increased competition level influences external as well as internal environment of an organization by influencing improvement of creativity, skill development regarding technology, social as well as international. However, increased rate of market competition helps to improve communication skills, management skills, and entrepreneurship skills of an organization which influences betterment of company growth. On the similar note, as stated by Hickman and Silva (2018, p.97), competitive Dynamics Theory market competition helps to improve interaction between the employees thus; it can help to improve organizational behavior. On the other hand this particular theory helps to explain the overall impacts of company actions as well as competitors’ reactions related to an organization.
2.7 Critical analysis of the challenges generated by new age retail services
Lack of digital skills is one of the major issues faced by many organizations in the retail industry in UK. However, retailers are struggling nowadays to attract different top digital technologies. In this era of digitization, new age retailers are incorporating various modern digital technologies like Artificial Intelligence, Big data and many others in order to improve their quality of service as well as products. On the contrary incorporation of modern technologies brings some other challenges regarding hacking, cyber security as well as risk assessment. On the contrary, as stated by Shafiq et al.(2019, p.37), right now consumers are not spending that much on retail as they once used to. However, retailers need to understand customer preferences in order to mitigate this challenge. Along with that another major challenge faced by retail organization is consumers are expecting seamless experience. On the contrary as mentioned by Xu et al. (2018, p.5), consumers want fluid online as well as offline experience during buying products. However, lack of proper marketing infrastructure became a major issue in the retail industry of UK. Modern way of marketing makes it essential for businesses in order to engage with different consumers across various channels. Increasing rate of using Emails as well as various social media platforms and other multichannel communication systems became an essential factor for business growth.
2.8 Gap in literature
This study has discussed about the influence of different competitive factors in the retail industry and increased level of competition due to growing rate of new age services considering existing literary sources. This has highlighted the challenge generated because of the introduction of new age services. Changes introduced by new age services create challenges for the existing companies. However, these studies have been remained limited in terms of impact of those changes on the development of the industry. These are also remaining limited on the strategic framework to neutralize such threat for the existing companies with traditional values. These can be considered as gap in literature.
2.9 Summary
This chapter helps to evaluate the critical business factors of the retail business in UK which are essential for maintaining organizational performance. In this study, influence of different digital technologies have been discussed which are adopted by many new age retail organizations in order to improve their products as well as service quality. In addition to that, discussion about different challenges currently faced by retail organizations is also included in this chapter. Along with that some critical strategies to resolve all such challenges has also been discussed in this study.
Chapter 3: Methodology
3.1 Introduction
This chapter includes detailed analysis about research philosophy, approach, design, sampling technique, different data collection tools, methods regarding the concerned topic. In addition to that, reliability as well as validity of collected data has also been discussed.
3.2 Research philosophy
For this particular research study, researcher has taken positivism philosophy which helps to observe the current market condition of the retail industry of UK. As opined by Ryan (2018, p.45), positivism philosophy helps to analyze factual data by seeking proper observation regarding current market trends. So the researcher has chosen this positivism philosophy in order to seek appropriate observation of current scenario of the market in order to identify changing market scenario as well as strategies in terms of new age services in retail industry. As stated by Pawlikowski et al. (2018, p.79), this also facilitates to identify the level of challenges faced by M&S because of such new age services.
3.3 Research approach
Deductive approach is one of the most essential research approaches to conclude a research based on evaluation of collected data (Influenced by Tjora 2018, p.55). As mentioned by Armat et al. (2018, p.221), deductive theory allows the researcher to evaluate market data as well as accumulated research data to identify highlighted issues in the scenario. Here the researcher has appropriately selected deductive approach to evaluate the data collected through primary as well as secondary methods (as influenced by Saunders et al. 2009, p.59). Thus, the study has been able to reach at justified conclusion regarding the competitive challenges encountered by M&S due to generation of new age services in the retail industry of UK.
3.4 Research design
Descriptive research design puts emphasis to conduct a research related to proper observation of existing data (Influenced by Tu 2018, p.133). This particular research design facilitates the researcher by focusing on the existing data in terms of secondary data sources. As stated by Kumar (2018, p.77), it has also focused on the observation of existing data sources in order to identify the changes introduced by new age organizations of the UK retail industry. Selection of descriptive design helps to conduct a proper survey among the staff members of Marks and Spencer in order to gather appropriate information about the concerned research issue (as influenced by Kothari, 2004, p.89). Adoption of this research design has been justified because of the evaluation of accumulated data through theoretical frameworks.
3.5 Sampling techniques and size
During this research process, the researcher has been taken probability sampling technique in order to gather proper as well as appropriate outcome for the concerned research work. Researcher has done a detailed survey with the help of 100 employees of M&S. Among them 65 employees has been considered as respondents. On the other hand, the researcher has also taken secondary information and different journals as well as books related to the concerned issue (as influenced by Yin, 2011, p.73).
3.6 Data collection tools and techniques
Online survey is one of the most effective tools for data collection for primary quantitative research procedure regarding the concerned topic. The researcher has been organized an online survey with the help of 65 respondents of Mark and Spencer. On the other hand, as stated by Dougherty et al. (2018, p.5), another important tool for data collection is secondary qualitative process. The researcher has taken important information from existing data on different books and journals. As stated by Assarroudi et al. (2018, p.49), interview questionnaire has been an essential tool for this concerned research project. The researcher conducted interview among the employees of Mark and Spencer in order to collect essential data.
3.7Data analysis methods
Data analysis methods are essential for acquiring appropriate evidential information for the concerned research project (Braun 2019, p.849). The researches have taken both primary and secondary method of data collection. The researcher gathered proper data with the help of quantitative data collection process such as different charts as well as graphs (as influenced by Harding, 2018, p.47). As mentioned by Nardi (2018, p.37), quantitative data collection method helps the researched to collect important information about current market situation with the help of online surveys. The researches have conducted the current research with the help of information taken from different primary sources like online surveys as well as interviews (as influenced by Flick, 2015, p.59). The researcher has taken 65 respondents of Marks and Spencer as the target group and acquired appropriate information about the concerned topic.
3.8 Reliability and Validity
One of the most authentic technological tools such as MS Excel has been used by the researcher in order to analyze quantitative data with the help of charts and graphs from different findings. In addition to that the researcher has taken authentic information from different existing books and journals. As opined by Richards and Hemphill (2018, p.227), validity of information of a particular research project mainly depends on validity of data sources. In order to ensure the validity of the collected data, researcher has focused on primary data considering employees as well as management of the company.
3.9 Ethical consideration
Ethical practice determines the perceptibility of the research documents. This study has followed the ethical framework of Data protection Act 1998 (legislation.gov.uk, 2019). This ensures the ethical practice of the researcher. All the accumulated data has been applied for academic purposes and there has been no application of commercial practice. Personal identities of the researcher have not been disclosed. All the collected data will be destroyed after the research work as a part of ethical practice.
3.10 Gantt Chart
3.11 Summary
This chapter of the study discussed about the type of research methods, approach taken for this particular research project. The researcher has been taken positivism philosophy and deductive research approach in order to seek observation of the current market scenario. The researcher has considered descriptive design in order to conduct proper data analysis. In this chapter different tools of data collection and methods have been discussed related to the concerned topic.
Chapter 4: Data collection and Analysis
4.1 Primary quantitative data
4.1.1 Primary quantitative data collection
Q1. Do you think entrance of new age retail services increases market competition of M&S?
|
Response |
Total respondent |
Number of respondent |
percentage |
|
Strongly agree |
65 |
25 |
38 |
|
Agree |
65 |
15 |
23 |
|
Neutral |
65 |
5 |
8 |
|
Disagree |
65 |
11 |
17 |
|
Strongly disagree |
65 |
9 |
14 |
Table1: Responses of respondents
Figure: New age retail services influences market competition
Q2.How far do you agree new age services influence customer behavior in UK retail industry of M&S?
|
Response |
Total respondent |
Number of respondent |
percentage |
|
Strongly agree |
65 |
23 |
35 |
|
Agree |
65 |
14 |
21 |
|
Neutral |
65 |
4 |
6 |
|
Disagree |
65 |
16 |
24 |
|
Strongly disagree |
65 |
8 |
14 |
Table2: Responses of respondents
Figure: New age retail services influences customer behavior
Q3. Do you agree that entrance of new age services influence organizational performance and strategies of M&S?
|
Response |
Total respondent |
Number of respondent |
percentage |
|
Strongly agree |
65 |
19 |
29 |
|
Agree |
65 |
13 |
20 |
|
Neutral |
65 |
8 |
12 |
|
Disagree |
65 |
15 |
23 |
|
Strongly disagree |
65 |
10 |
16 |
Table3: Responses of respondents
Figure: New age retail services influences organizational performances
Q4. Do you think that entrance of new age services influences organizational culture of M&S?
|
Response |
Total respondent |
Number of respondent |
percentage |
|
Strongly agree |
65 |
28 |
43 |
|
Agree |
65 |
12 |
18 |
|
Neutral |
65 |
3 |
5 |
|
Disagree |
65 |
14 |
22 |
|
Strongly disagree |
65 |
8 |
12 |
Table4: Responses of respondents
Figure: New age retail services influences organizational culture
Q5. How far do you agree that incorporation of different modern technologies by new age retail services change market trends of retail industry?
|
Response |
Total respondent |
Number of respondent |
percentage |
|
Strongly agree |
65 |
21 |
32 |
|
Agree |
65 |
17 |
26 |
|
Neutral |
65 |
7 |
11 |
|
Disagree |
65 |
10 |
15 |
|
Strongly disagree |
65 |
10 |
16 |
Table5: Responses of respondents
Figure: Incorporation of modern technologies influences market trends
4.1.2 Primary quantitative data analysis
From this survey it has been noticed that most numbers of respondent employees have agreed the fact that raised number of new age retail services has influenced market competition of M&S (as influenced by Theguardian.com, 2019). Almost 61% respondents agreed positively. Most number of employees reacted positively that entrance of new age retail services has influenced organizational performance because of raising competition (as influenced by Nytimes.com, 2019). This also influences customer behavior as well as organizational culture. Most number of employees said that incorporation of modern technologies by different new age retail services has influenced the market trends in the retail industry in UK which influenced the market competition.
4.2 Primary qualitative data (Interview)
4.2.1 Primary qualitative data collection
Q1. What do you think about the impact of new age retail services?
| Operation manager | Finance manager |
| “ Due to entrance of new age retail services operation strategies have been changed due to change in customer preferences” | “New age retail services influenced productivity and financial growth of M&S” |
Q2. How such changes are influencing trends of market?
| Operation manager | Finance manager |
| “ Due to entrance of new age retail services marketing strategies have been changed due to change in customer behavior” | “New age retail services influenced strategic changes in order to improve growth of M&S” |
Q3. Which strategies can be effective for such raising competition?
| Operation manager | Finance manager |
| “Targeting new market and quality improvement can be effective for increased competition” | “Incorporation of strategic marketing can be effective for raising competitions” |
4.2.2 Primary qualitative data analysis
According to the operation manager of M&S, new age retail services influences changes in customer preferences and operational strategies of the organization (as influenced by Forbes.com, 2019). These lead towards change in strategies in order to improve growth and productivity of the company. On the other hand, according to finance manager of the company increased rate of new age services in the retail industry has a direct impact on overall financial growth of the organization. New age changes in retail industry influences market trends of the retail industry (as influenced by Cook, 2017, p.59). Thus, it influences significant changes in marketing strategies in order to understand the change in customer behavior. According to the managers of M&S, targeting different market as well as improvement in quality can be helpful to mitigate all challenges regarding increased competition in the retail industry of UK.
4.3 Secondary thematic data
Theme 1: New age retail service changes consumer behavior and market trend
Due to incorporation of modern representation by the new age retail services, 90% purchasing decisions of new generation consumers are made instinctively (Forbes.com, 2019). New age services offer fluent and effective digital data handling techniques in order to attract new age consumers. Almost 51% consumers love to get information as well as pay by using their mobile in-store as example they tends to prefer omnichannel retail. Thus, it causes significant change in current market trends. 77% consumers are willing to accept the idea of preferring handling over data in case of exchanging. In the current scenario, new age retail services forces consumers to focus on quality of the products rather than the brand name. According to the current market trends consumers are driven towards better quality products in cheaper price.
Theme2: Market competition in UK retail industry has been increased because of new age retail services
Currently Mark and Spencer have reported falling food as well as clothing sales in the year 2018. Increase in number of new age retail stores influences the sales volume of M&S as it decreases almost 2.2% at the end of September, 2018. Sales volume of food items of M&S were down by 2.9% and sales of clothing and home decors decreased by 1.1% in the year 2018. Total revenue fell by 3.1% in 2018 (Bbc.com, 2019). Entrance of new age services affected the overall business of M&S due to incorporation of innovative and attractive changes in marketing as well as business strategies.
Chapter 5: Conclusion and Recommendation
5.1 Conclusion
Thus it can be concluded from this study that, growing rate of new age retail services are nowadays making the competition level high for M&S. In order to mitigate challenges retailers need to focus on the impact of different competitive factors in the retail industry. The researchers used both primary and secondary qualitative as well as quantitative data analysis in order to collect specific relevant information from a target group of employees. Growing rate of technological advancement, incorporation of innovative marketing strategies became a challenge for M&S. Thus, the profit rate and sales volume of Mark and Spencer has been decreased over the years. This study has been discussed about some recommendation in order to mitigate all the issues regarding high rise of competition level.
5.2 Linking with objectives
Objective one is considered about the factors which are influencing market competition of retail industry. This objective has been met in 2.3 in literature review. Along with that, in primary quantitative question 1, it has been met partially. Second objective has been considering changes introduced by new age retail services which are partially met in 2.4 of literature review along with primary quantitative data. Generated challenges by new age retail services are the concern of third objective which has been partially met through qualitative data.
5.3 Future scope
This study has highlighted the impact of new age services in terms of retail industry considering market competition as well as organizational strategies. This study has also highlighted the impact of such factors on organizational performance of existing companies with traditional values. Hence, this can be applied to measure the impact of such introduction of new services on different industries. Along with that this study can be considered to analyze changing trend of market because of introduction of new services.
5.4 Recommendation
| Specific | Development of communication skill |
| Measurable | It can be measured by well coordination between the employees of M&S |
| Achievable | It can be achieved by giving proper skill development training to the employees of M&S. |
| Realistic | It will facilitate the organization to improve overall growth |
| Time | 20 days |
Table 1: SMART Recommendation
| Specific | Development of marketing strategy |
| Measurable | It can be measured with the help of improved market promotion of products and services. |
| Achievable | This can be achieved by proper skill development of marketing strategies. |
| Realistic | It will help the organization to improve their overall marketing strategies. |
| Time | 25 days |
Table 2: SMART Recommendation
| Specific | Technological advancement |
| Measurable | It can be measured by implementation of various modern technologies in making different operational as well as marketing strategies. |
| Achievable | It can be achieved with the help of skill development of the employees and incorporation of different new age technologies |
| Realistic | This will help the organization in order to improve growth and productivity. |
| Time | 22 days |
Table 3: SMART Recommendation
5.5 Self reflection
From this above research project I get to know about current level of competition increased due to entrance of various new age retail services in the context of M&S. right now sales volume and revenue of M&S has fallen down due to increased competition level in the retail industry of UK. Entrance of some new age retail services provided by Uniqlo, Gap and some other retail organization increased the market competition. There is a significant amount of fall in profit because of lack of incorporation of modern technologies, poor quality of products, and high price of the products. This research work discussed about various competitive factors which are essential for the retail industry such as proper knowledge about current trends, consumer preferences, skill development of workforce as well as improvement in quality and price structure of the products. A detailed qualitative and quantitative data analysis has been done by the help of 65 respondents of M&S to collect correct information about the concerned topic. From this research project I have found that proper research skill, analytical skills, communication skills, strategic skills and risk assessment skills are most essential for development of a research project. Thus, lack of all these skills became a major challenge during this research work.
5.6 Development Strategy
| Skills | Strategies | Time required |
| Research skills |
|
1 week |
| Analytical skills |
|
2 week |
| Strategic skills |
|
4 week |
| Communication skills |
|
3 week |
| Risk assessment skills |
|
2 week |
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Appendix : Gantt Chart
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Activities |
Week 1 |
Week 2 to 5 |
Week 6 to 12 |
Week 13 to 17 |
Week 18-21 |
Week 22 to 23 |
Week 23 |
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Topic selection |
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Data Collection |
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Planning process |
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Existing literatures are reviewed |
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Research plan Development |
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Choosing techniques of research |
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Primary data collection |
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Analysis of collected data |
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Collecting findings |
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Conclusion and recommendation |
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Development of rough overdraft of the project |
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Submission |
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