SYDNEY: One of Australia's biggest advertising accounts, Woolworths
supermarkets, worth in excess of A$65 million, is up for
grabs.
Australia's largest grocer and second largest retailer has called for
expressions of interest from agencies, including long-time incumbent Leo
Burnett Connaghan & May. The company is expected to make a short list in
the next few months. Burnett has held the account since 1995 and helped
develop Woolworth's current 'Fresh Food People' campaign. Its managing
director, Troy Ruhanen, is confident the agency will retain the
business.
Woolworths warned Burnett that the account would be reviewed more than a
year ago.
"Woolworths is reviewing every facet of its business. The fact that is
has taken this long to get to advertising is a positive sign," said
Ruhanen.
At a time when even the most stable agencies are retrenching staff, few
shops can afford to lose an account of this size. Woolworth's annual
advertising expenditure places it alongside major brands such as
McDonald's.
Ruhanen said the advertising review was part of a large-scale
cost-cutting exercise by Woolworths called "Project Refresh", which
began more than two years ago and aimed to save money through
nationalised buying and improvements in its distribution network. Since
implementing the project in 1999, Woolworths has reported a 17.6 per
cent rise in 2000/01 net profit of $428.4 million from $364.1 million the year before. It is expected to sign a three-year
contract with the winning agency.
