Woolies turnaround is on the cards

Sarah Homewood
By Sarah Homewood | 3 March 2016
Sarah Homewood, AdNews journalist

Woolworths bashing has become the Australian media's favourite past time for the last 12 months, and not without good reason.

Last year, the company lost its CEO, CMO, its director of customers, brand and format, its retail services lead, as well as it's chief loyalty and data officer. In 2014, the business held a massive media and creative pitch, with the first few weeks of this year seeing the brand cut all ties with its creative agency, Leo Burnett.

No small amount of change, and all while this was going on, its financials were following a similar trajectory.

Woolworths' chairman, Gordon Cairns, acknowledged at its annual general meeting last year that its results for 2015 were frankly “unacceptable”.

He said that the business has made some mistakes, but it's learnt from them and now it's about to embark on fixing them. Woolworths has seemingly wasted little time moving full stream ahead on that mission this year.

Just 18 days into the new year, the brand announced a decision that shareholders have been hoping for, it started a process to exit its failing hardware business Masters, as well as Home Timber and Hardware, which has been a lag on the business.

It also filled its empty CMO role with Andrew Hicks, who was handling the role on an interim basis and was previously general manager of marketing at Woolworths Liquor Group. This coincided with the surprise appointment of M&C Saatchi without a pitch.

The changes didn't stop there, when revealing its half year results last week, the business finally filled the empty seat at the top naming Brad Banducci as CEO and managing director.

Woolworths is one of the most powerful brands in the country, even if it hasn't been using its muscle as much lately. It's one of the biggest advertisers and it has a touch point on the lives of almost every Australian, through groceries, liquor, insurance and even mobile phone offerings.

Signs point to the fact that it will be looking to develop that strong brand again, with its new agency M&C being know for its work on brand platforms, such as the one it developed for CommBank.

There are some hard yards to put in but the signals are there that Woolies is set to fire again.

Such a turn around isn't unheard of for the sector. Woolies biggest rival, Coles, was in a similar position some eight years ago. It had a management and morale crisis, along with an identity one, but it managed to turn around and give the biggest player in the space a run for its money.

For Woolies to pull a Coles, it has already earmarked it wants to return to its customer centric past and shift from a “knowing culture to a listening one” - which means, listening to its store staff as to what the brand could do better, listening to its customers on where Woolworths can provide value, and listening to its suppliers on how it can improve partnerships.

The reality is the fresh food people have been frozen by a lack of leadership and it appears lack of direction, so here's hoping the business can defrost and create an infrastructure that matches its messaging and develop a strategy that can pull it out of the red and into the black.

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