Woolworths has dropped Leo Burnett and handed its creative business to M&C Saatchi without a pitch, AdNews understands.
M&C Saatchi previously held the Woolworths creative account for 12 years before it switched to Droga5 back in 2012 . The relationship with Woolworths was never regarded as a huge success and the supermarket moved its creative business to Leo Burnett in 2014.
It is thought M&C Saatchi has been in discussions with Woolworths for some time, and is likely to be working with the supermarket on a brand platform that will differentiate it from Coles. M&C will likely be looking for around 40 people to service the account.
Andrew Hicks has now been promoted into the CMO role after holding the position on an interim basis for six months following former CMO Tony Phillips' shock exit in May 2015. Previously he was general manager of marketing at Woolworths Liquor Group.
Woolworths director of marketing, Andrew Hicks, says: “We’re delighted to be starting a new partnership with M&C Saatchi. They have a formidable client list including some iconic and complex Australian brands and we’re very happy to be adding Woolworths to that list.”
“We have a solid foundation to build on with our price position and long-standing reputation as the Fresh Food People. With M&C Saatchi, we now look forward to creating a new generation of work that supports the next phase of our transformation.”
Hicks also thanked Leo Burnett for their work: “Leo Burnett have brought their skills and ability to our diverse business. We thank them for their work in that time, including the relaunch of the Fresh Food People commercials, Low Price Always and most recently our Make It Famous Christmas campaign.”
Pete Bosilkovski CEO of Leo Burnett Sydney, says: “The Woolworths Supermarket business is in a state of significant change. We wish them all the best. I want to thank our talented people for their incredible hard work and unrelenting commitment over the two years. As always, our focus now is on our people, especially those directly affected by this change.”
The news will be a highlight for M&C which has been mired in controversy for the past week following its 21st birthday party which drew stark criticism for the choice of burlesque entertainment. Many were outraged and some described it as an indictment of broader sexism in the industry. Others saw it as purely entertainment, however, the agency apologised. It's not known if the decision to move was shaken by the press coverage that ensured following the event.
M&C Saatchi Group CEO, Jaimes Leggett, says, “Woolworths is one of Australia’s largest advertisers, one of the country’s most valuable brands and one of the most sought after accounts. We couldn’t be more excited to be back working with the Woolies team.”
The agency is also adjusting to the changes in its relationship with Optus, which extended its roster to include six agencies in January.
There have been a raft of changes in the marketing team at Woolworths in the last 12 months including the departure of CMO Tony Phillips in May last year, who left just a year after joining from Coles to take on the Woolworths CMO role in March 2014. Jess Gill, former director of customer, brand and format, also departed at the same time leaving the marketing department in disarray. Former Bauer Media CEO Matthew Stanton was appointed as chief transformation officer, to steer the supermarket through a period of change.
Leo Burnett was appointed in March 2014 at the same time as former Coles GM of marketing Phillips joined Woolworths to lead marketing and coincided with the pitch for Woolworths media business, which remained with Carat after a substantial pitch process.
Droga5 had begun a partnership with British supermarket icon and chef Jamie Oliver but during its time with Leo Burnett, the supermarket has pursued a price-led marketing strategy with the agency introducing the Cheap Cheap positioning.
Leo Burnett also handles Big W after taking the business from Saatchi & Saatchi in May. It's likely this relationship is also impacted.
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