Market Analysis: M&S and Ted Baker

Marks and Spencer: a tasty set of results. Ted Baker few brands with the sheer personality of Ted Baker but not an easy ride ahead for the new owner

Ross Hindle, Analyst at Third Bridge comments on M&S results:

“M&S produced a tasty set of results. M&S’s food offering continues to deliver for the Group and our experts say it could be their secret weapon against the inflationary pressure set to rattle other supermarkets.

“M&S’s premium brand positioning means they are less vulnerable to the pressure from discounters and many of the shoppers they do lose will be replaced by new customers trading down from eating out. Also, the old habits of splitting grocery shopping between multiple supermarkets are back, now the need to do one big weekly shop and return home has dissipated with Covid.”

“As M&S continues its transformation programme, benefits are expected to continue to flow to shareholders. However, one concern does remain around M&S’s clothing range which once again finds itself in no-mans land between affordable and premium clothing.”

"Management echo's the city's concerns around inflation and its result on the UK consumer's buying behaviour. As such, the next 12 months will prove challenging for all retailers as they battle market share with margin.”

After interviewing a number of executives in the luxury clothing retail space, Alex Smith, Global Sector Lead at Third Bridge comments:

The most urgent task for the new owner of Ted Baker is to revitalize the brand’s fading image. Our experts say that there are very few brands that have the sheer personality of Ted Baker and the value of a refresh could be huge.”

“The company’s revenue growth ambition of 5% is achievable with the right level of investment and commitment from the new owner and more relevant products. It also requires the management team to get behind Ted’s digital strategy.”

“The sheer size of the US market means a massive opportunity for future growth. However, incumbent digital players, such as Amazon and eBay, are also moving into premium fashion.”

“Supply chain problems and today’s cost of living crisis are here to stay for at least for the next 6-12 months.”

“Hybrid working gets more entrenched every day, this leaves a big question mark over the future demand for formal workwear. Ted Baker is wisely moving away from formal occasion wear towards everyday casual clothes.”


Third Bridge is a global primary research firm that interviews more than 6,000 internationally recognised industry experts and business leaders a year to compile 360-degree market intelligence for institutional investors. www.thirdbridge.com