EXCLUSIVE: New Zealand-owned dairy giant Fonterra has appointed CumminsRoss as its Australian creative agency, amid increasing competition in the dairy category.
CumminsRoss won the business after a competitive pitch, and will sit on the conglomerate's agency roster alongside Clemenger BBDO Melbourne. AdNews exclusively revealed the pitch last month.
CumminsRoss will have creative responsibilities in Fonterra’s beverages, dairy desserts and yogurt business. Before the pitch, Clemenger BBDO Melbourne handled most of these brands, although Sapient Nitro handled one of the yoghurt brands, Nestle Diet.
Clemenger BBDO Melbourne did not re-pitch for these brands, but continues to handle the brands that were not involved in the pitch.
Fonterra general manager of marketing and innovation Brad Cook said: "We're delighted to appoint CumminsRoss as our new creative agency. The CumminsRoss leadership team is very experienced and has a proven track record for delivering compelling and successful campaigns.
"After a lengthy pitch process, we're convinced that they will be an ideal creative partner for Fonterra and will complement our existing relationship with Clemenger BBDO."
CumminsRoss managing director Chris Jeffares said: "Fonterra is an amazing company and their portfolio of brands is testament to their status as a blue chip company. The quality of the Fonterra team is exceptional and the pitch process brought us close together very quickly."
Fonterra's decision to split creative duties comes as competition in the dairy category continues to heat up. The industry has undergone significant change since Fonterra’s last major pitch in 2006, which saw the appointment of Clemenger BBDO and OMD in Australia.
Fonterra’s major competitors Parmalat and National Foods have undergone periods of growth and consolidation. In 2008, Japan's largest beverage maker Kirin purchased National Foods for $675 million. National Foods then bought Dairy Farmers in 2008 for $910 million. In 2009, Parmalat bought $70 million worth of National Foods' dairy business.
In 2010 French dairy giant Danone announced its plans to re-enter the Australian market, in a bid to go head-to-head with Fonterra, Parmalat and National Foods in the $1 billion yoghurt market.
This year, competition in the dairy sector has become more intense, as big name retailers like Coles and Woolworths have put their own cheaper milk, cheese and cream brands into the market, significantly undercutting established brands on a price basis. Their tactics have sparked public debate about the long-term impact of such moves on the dairy industry.
Fonterra's media agency, OMD, was unaffected by the pitch. TrinityP3 oversaw the pitch process.
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