The shifting fortunes of British retailer Marks & Spencer (M&S) have been making global headlines amid fierce competition in the apparel sector. Despite an increasingly robust economy and growing consumer spending, M&S' Hong Kong operations have not been spared.
In a category that has virtually been re-modelled by the off-the-chart growth of aggressive, innovative players such as Zara and Mango, M&S is facing a brand crisis that is resulting in the city's leading commercial landlords such as Swire Properties withdrawing tenancy rights.
The closure of the M&S store at high-end shopping mall Pacific Place underlines the seriousness of M&S' image problems, one that could affect its ability to land prized retail locations. Perhaps unsurprisingly, Swire has leased the prime location to category leader, Spanish fashion house Zara -- the stratospheric rise of which has been down to a retail strategy almost the polar opposite of M&S'. Continually updating and re-designing its clothing lines, in-store stocks at Zara are kept low, with high-turnover for coveted items that consumers know will only be on shop floors for a limited time.M&S, on the other hand, has traditionally been viewed as a reliable, staid, quality brand that -- despite ventures into more edgy, contemporary clothing lines for women, men and children -- has failed to tap the market pulse.
To fend off its deteriorating image, M&S stores in the territory recently underwent select revamps, resulting in more black and white interiors and even a standalone menswear outlet in bustling retail zone Causeway Bay.
Its strategy to expand into emerging regional markets has seen store openings in India, selling chiefly clothing and household ranges; with plans to expand into Macau to tap the increasingly affluent travellers from across the border. Despite recent efforts in the UK market towards greater product innovation and more competitive pricing, M&S has a battle on its hands to successfully sharpen its image so consumers, but more importantly landlords, will want the brand.