M&S versus Debenhams is only round one

M&S today launched its first pre-Christmas Sale in four years, slap bang in the middle of Debenhams' three-day spectacular. Both retailers will be hoping that M&S' 20 per cent discount and Debenhams' promise of£200 million worth of price cuts will lure in customers who are constantly being told how depressed they are.

M&S' Sale has been labelled a last-minute response to dire trading on the high street. It is understood the media activity was only booked in six days ago. However, Sir Stuart Rose had previously outlined that he didn't want Marks & Spencer to be left behind in the battle for share of spending.

While the decision has inevitably thrown up questions about what kind of order M&S' house is in, a more important question is what effect will the increasing prevalence of this short, sharp and noisy type of Sale have on customers' psyche?

Retailers that take this course face the age-old criticism that Debenhams repeatedly comes up against - will consumers now wait for more events like this before parting with their cash? It will not encourage brand loyalty.

Where “secret Sales” and “friends and family vouchers” aid retailers by clearing stock as they go, they also conversely encourage customers to save their pennies in anticipation of such promotions.

As Rose said this week, all retailers are fighting for their share of the “limited pot of gold” this Christmas, but do they lose some credibility in shouting about it? Or is there no other option?

The fact that the high street is being flooded with such promotions points to a feeling of the latter among many. In recent weeks discounts have been launched by retailers including Warehouse, Oasis, Topshop, Dorothy Perkins, Bhs, House of Fraser, Wallis, Gap and Goldsmiths.

It is expected that the majority of retailers will have gone in to Sale by the last weekend before Christmas.

Even retail bellwether John Lewis has become more vocal about its “Never knowingly undersold” policy, although it has managed to maintain some semblance of steadfastness with its customers by keeping it subtle. However, a 14 per cent slump in sales in the week to November 15 has shown that no one is immune and points to the fact that people are just not spending.

According to John Lewis head of selling development Barry Matheson, “in spite of the noise of competitors' promotions, we will not be beaten on price”.

But if we are, as Debenhams deputy chief executive Michael Sharp said “staring into the face of the worst Christmas we had ever had”, the battle will heat up. “Nobody knows how it will pan out” this Christmas, he said.

Let battle commence.