OMD: ‘We didn’t promise anything crazy’ for Coles

Rosie Baker
By Rosie Baker | 17 May 2016
Peter Horgan

OMD is on the hunt for 30 staff as it looks to find the team it needs to service the $48m Coles business after winning the account from UM yesterday. The business had sat with UM for 13 years so it will be a significant transition.

The business will be run out of the Melbourne office but OMD plans to offer cover from its other agencies, including Sydney and Brisbane, initially as it brings on the right people.

Horgan told AdNews from Melbourne today that he plans to staff up the Melbourne office by about 30 people, bringing the agency to around 150 heads and making it one of the largest media agencies in Melbourne.

“It’s about staffing sustainably,” he tells AdNews. “That’s what got us here to the strong position we’re in.”

It’s thought that Coles brought forward the decision, with UM and Zenith still very much part of the process until as late as Friday. It has fuelled speculation around what OMD ‘pulled out of the bag’ at the last minute according to one source. 

When it comes to rates, which is where speculation in the market always leads to, Horgan says “we put forward what we feel we can achieve.”

“We didn’t promise any crazy stuff. There was some push and we eased off when it felt uncomfortable, but we didn’t buy the business. I’ve never been in the game of buying business. When you start doing that it just spirals downwards and OMD has always been vocal about that.”

He puts it down to the strength of OMD both in terms of culture and scale and capabilities.

“OMD is about bringing big clients in to the heart of the agency, it’s symbiotic of our culture and our fast-paced clients. You’re buying in to the scale and culture of OMD and our capabilities.”

Coles’ decision to move its $48m media business is a blow for UM CEO Ross Raeburn who has been in the post nine months. His tenure saw some early successes with the win of the Optus business, but failing to hold on to Coles means that one of the agency’s largest accounts is walking out the door.

It’s not known what the account move means for UM’s Melbourne office.

Zenith was thought in recent weeks to be the frontrunner in the Coles account, which surprised many. The agency, which has had a number of leadership changes over the last nine months and prior to that a difficult few years. A number of its largest accounts such as Qantas and Nestle leaving the agency which prompted an overhaul of strategy and positioning currently being ushered through by Matt James, CEO of Publicis Media in Australia.

Had Zenith scooped the Coles account, it would have been a coup for James, who replaced Ian Perrin as CEO of Zenith prior to taking on the group role when the Publicis Groupe decided to launch Publicis Media here. 

It has likely accelerated the transformation strategy James is putting in place as the agency would have had to demonstrate that it could get to work immediately on Coles.

OMD, like other large agencies in the market, is waiting for decisions on a number of large accounts. It is currently defending both Tourism Australia and Village Roadshow. The agency will be hoping Coles is just the start. Decisions on both are expected shortly.

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