By Paul Sandle and Sarah Young
LONDON (Reuters) - For generations, British children went to school in Marks & Spencer's (MKS.L) clothes, teenagers turned to it for first interview suits and shoppers of all ages bought its underwear.
But the arrival over the last 20 years of fast, cheap fashion at one end of the market and affordable luxury at the other has left M&S struggling to recapture its universal appeal.
After 14 consecutive quarterly declines in clothing, footwear and homeware sales, time could be running out for the man tasked with finding a solution - Dutchman Marc Bolland.
A rising share price, a strong dividend and signs of improvement in its clothes had largely kept investors onside during his five-year tenure, but a disastrous Christmas has reignited the question of whether M&S needs a fresh direction.
A change of faces at the top of several of Britain's biggest retailers in recent months could also add to the momentum.
A top-30 investor said he was sticking with M&S for now.
"There have been clear signs of improvement in recent years, not least in merchandise, and the Christmas problems should prove to be a one off," he said on condition of anonymity.
M&S declined to comment for the story.
Investors broadly support Bolland's strategy. M&S has a reputation for quality and innovation in food no longer replicated in clothing, something Bolland has tried to address.
In 2012, he brought in Belinda Earl, previously at upmarket store Jaeger, to resuscitate womenswear. Her recent collections have wowed the fashion press. This season, Vogue has singled out a seventies-style suede skirt and a pink trench coat.
Quality has also improved through the use of more natural fibers and he moved to make M&S more competitive against rivals like Zara, part of Spain's Inditex, where new ranges hit the shelves every week. He is overhauling the supply chain to respond quicker to fashion trends and improve margins.
Over Christmas womenswear was the best performing category, and the signs are good for the spring. "These pieces are more edgy and more trend-led than anything we've seen from middle England's erstwhile favorite to date – and we're more than a little impressed," said the Metro newspaper.
The website has been revamped, with customer reviews, links to social media and content tailored for mobile devices although it has had teething problems.
The strategy has yet to deliver higher sales, although margins are improving, giving investors hope for higher payouts after hints it could increase the dividend in May.
"There is an element of investors being paid to wait in as much as the dividend yield is 3.8 percent, which is fairly punchy," said Hargreaves Lansdown Stockbroker's head of equities Richard Hunter, of a yield that compares to a sector return of 3.4 percent on a forward year basis.