Suede Skirt That's Yet to Reach Stores Helps M&S Halt Sales Drop

LONDON, United Kingdom — Marks & Spencer Group Plc said its long- awaited return to clothing sales growth was partly down to a new suede skirt — that hasn't even gone on sale yet.

The U.K. retailer wooed the fashion world in February, as style icons Alexa Chung and Olivia Palermo were photographed wearing the 199-pound ($295) item at New York Fashion Week. The resulting discussion on social media helped drive more shoppers to the Marks & Spencer website, according to the company.

“This is just the kind of buzz and energy that could see M&S return to fashion favor,” Anusha Couttigane, a consultant at researcher Conlumino, said by e-mail after the company reported the first quarter of growth in clothing sales since the appointment of ex-Jaeger boss Belinda Earl as style director in 2012. M&S’s decision to create a waiting list for what it calls the “skirt of the season” creates an illusion of exclusivity, she said. The product is due to go on sale in mid-April.

Emphasizing exclusivity dovetails with M&S’s strategy of favoring full-price sales rather than sacrificing margins. This approach is starting to bear fruit, the company said Thursday as it maintained goals for full-year gross margins.

Same-store sales of general merchandise gained 0.7 percent in the 13 weeks ended March 28, beating the median estimate of 21 analysts for a 1.1 percent decline. The division mainly comprises of clothing, sales of which rose 0.6 percent.

Bolland Relief

The performance brought relief for Chief Executive Officer Marc Bolland, who had presided over 14 straight quarters of declining same-store general-merchandise sales. M&S shares rose as much as 6.5 percent to the highest since January 2008.

M&S has ordered five times as many suede skirts as it had originally planned to, in order to meet heightened demand, according to a representative for the London-based retailer.

While the product has generated a lot of publicity, that’s no guarantee of popularity among its main U.K. customer base, said Bryan Roberts, an analyst at Kantar Retail.

“There’s been quite a warm reception to the spring-summer womenswear ranges,” Roberts said in an interview. “But there’s a big difference between London fashion journalists and housewives in Scotland, Cornwall and Yorkshire.”

By: Sam Chambers; editors: Matthew Boyle and Paul Jarvis.