No one has done more to capitalise on that ghastly sounding word ’premiumisation’ over the last few years than Marks & Spencer. In fact, the retailer has gone to such lengths to drive this home to consumers that you could coin another P-word - pornographisation - to describe it, such has been the success of its occasionally lambasted but hugely successful ’This is not just food...’ marketing, whose overtones rival only Nigella Lawson for titillating innuendo.
The in-store bakery (ISB) is the next thing on the agenda to be sexed up. Having undergone a review, the planned changes - teasingly under wraps - will begin filtering through over the next six months, from January. "We can see the ISB becoming a real hero category where people think, ’Wow, M&S bakery!’" says new bakery category manager Gail Richards, who, for the last five months, has covered core pre-packed bakery as well as in-store bakery.
This will involve a renewed focus on smaller artisan producers and sourcing regional favourites. "We could do so much there," she says. "There are so many fantastic things we’ve seen that couldn’t be done in a large factory because the product’s either hand-finished or hand-topped. They are the types of areas where we’re looking to work with smaller businesses. We source from throughout the UK - you’d be surprised how many bakers we have in every single part of the British Isles. We already sell an Irish range, but we need to have a wider Scottish and Welsh range."
established supply base
What separates M&S from other retailers is that its products are entirely own-label. This means it has an established supply base, with relationships stretching back four decades. But five new suppliers will be joining over the next two months, two of which approached M&S.
You won’t get your foot in the door by approaching M&S with something it already stocks, says Richards. "I would say to potential suppliers, go out and look at the market, see what’s out there. The first question we will ask is ’What’s so special about your product?’ One, it must taste really good; two, it must follow the brand values; and three, why is it different? Will it add incremental sales and will customers know what to do with it?"
While a buyer may leapfrog around departments, Richards says there is long-established technical expertise in M&S’ bakery department, including Barry Stocker, senior bakery technologist, with 34 years’ experience in the baking industry. Richards also works alongside a technical manager and a product development manager and, together, they are responsible for setting the strategy for bakery.
"While we have people specific to bakery, there are other people we would rotate - it really depends on your skill base for the category. I’ve worked across a spectrum and that keeps you fresh, because you’re always learning new things," says Richards. "I love the diversity in bakery: one minute I’ll be talking about wheat prices; the next minute I’ll be standing in front of eight croissants judging the best flakiness, and the next I’ll be talking to the technical team about a new process for breadmaking."
What distinguishes bakery from a category like groceries, which Richards has also managed, is the smaller number of suppliers, but there is scope for innovation across all product segments. "Bakery has 99% penetration. Generally, 60% of our customers will only pick up one bakery item in the shop. They could be putting so much more in the basket and that is our greatest opportunity and our big challenge over the next year."
This will be achieved through tailoring ranges to M&S’ plethora of retail formats - 13 in all. Across the estate of over 570 stores, it has the rapidly-expanding Simply Food, large high street stores and railway and motorway outlets, all of which attract different customer types. A large percentage of those are one-to-two person households. "If you’ve got a beautiful Mediterranean bread, but it feeds four-to-six, then people are not going to pick it up. What we’re now doing is having smaller sizes of those types of products. That way, they’re more inclined to put it in the basket. Smaller 400g loaves are now out-performing 800g because of our customer type. For most other retailers, 800g is their core."
In recent months, M&S introduced individually-wrapped croissants, pains au chocolat and Danish, sold en route to the checkout, which have taken off. "I love a croissant, but my husband doesn’t, so I don’t want a four-pack of croissants. This way people can mix-and-match," she says.
M&S has had a few firsts in the baking industry, she adds, including the hugely successful tubs of mini-bites, which were launched five years ago. The range is refreshed with new flavours such as Rocky Road, introduced last year, which has already become the category’s fourth-biggest seller. Two months ago, Amaretto was added to the line-up and is shaping up to be another strong performer.
"The mini-bites absolutely fly out of those smaller stores," she says. "And cakes do well because people will often be going to visit someone. The whole brief behind mini-bites revolves around people feeling a bit guilty about having a big slice of cake. They want nice little nibbles. You can eat as few or as many as you wish."
Recently M&S introduced six-pack mini lemon muffins for the same reasons. "Sometimes you don’t want a whole muffin, but you want to treat yourself. That’s something you’ll be seeing more of."
Similarly, boxes of bite-size Turkish patisserie Baklava have rapidly built up a loyal following. "They’re a big seller. Our customers used to phone up to say ’You’ve run out today’. So now we make sure we don’t run out!"
Being entirely own-label gives M&S an important advantage over the competition, she believes. "We can control the whole process, from raw materials to how the products are actually made, which gives us consistency of quality. We can make claims like ’all our breads are free from preservatives’, because we know everything that’s in our products.
"That’s important for new suppliers who approach us, because they need to work with our brand values; they need to know we don’t do GM, hydrogenated fats or preservatives in the bread. Hopefully, by January 2008, 99% of our bakery range will be free from artificial colourings, flavourings and preservatives. We want people who will support us in that ambition." n
=== At a glance ===
Job history: Worked for Sainsbury’s for eight years across a number of categories before joining M&S five years ago; there, she has category-managed fish, chicken, frozen foods, dairy, juice, groceries, biscuits and savoury. Five months ago, she joined the bakery team.
Top tip to new suppliers: no phone calls please; just send a one-page summary of who you are and what’s your point of difference via email. Do you fit with M&S’ ’Plan A’ corporate sustainability policy?
Favourite product: "I love scones! I’ve benchmarked them so many times, I keep saying,’Let’s do scones again!’"
Outside interests: "Since I’ve joined bakery I seem to be putting on weight. So I’ve taken up tennis and pilates to balance the over-eating."