Marks & Spencer to spend £100m on in-house web platform

Retail giant Marks & Spencer is ditching Amazon as its online platform host, and spending £100m to bring the entire operation in-house.

The project will go live in the first quarter of 2014, and also involves the order management systems and in-store applications.

Marks & Spencer CIO, Darrell Stein, told Computing that the decision to move was down to various strategic drivers, including the fact that Amazon is a competitor.

"We went live with Amazon in 2007," said Stein. "The Marks & Spencer site is a veneer on top of the Amazon code. The site has helped to grow our business from $200-300m per year to close to $1bn per year, but it's not great for innovation.

"Amazon is a competitor of ours. So when all the technology you're basing your business on is owned by the competition, you're not in a very sound position strategically."

Stein added that when new online products – or even small coding changes – are required on the site, the process is sometimes delayed because Amazon is slower to implement the request than the business would like.

There is also the issue that any hosting provider wants to charge per transaction, which when you perform as many transactions as Marks & Spencer, amounts to a hefty overhead.

"We want to drum the costs down as far as possible, and as a growing business with increasing sales, we expect to see economies of scale," said Stein. "You don't necessarily get that when you outsource."

He said that although the move to in-house will save operating expenditure, it will involve a large capital outlay.

"We're going to spend more than £100m on the new platform," he said. "The answer to how much will we save depends on how much we sell."