Woolworths is working on a new supermarket advertising campaign after appointing its third creative agency in five years, ending its relationship with Leo Burnett in favour of long-time partner M&C Saatchi.
Australia's largest retailer is looking at new ways to differentiate itself from arch rival Coles and restore same-store sales growth after a series of advertising missteps over the past few years.
Woolworths' iconic Fresh Food People campaign, created by Leo Burnett almost 30 years ago and refreshed by Droga5 three years ago, is still being aired.
The retailer is also persisting with its Always at Woolworths campaign, created by Leo Burnett to replace the much-maligned Cheap Cheap ads, and Prices Dropped, which highlights the $500 million investment into reducing food and grocery prices.
However, it is understood Woolworths has asked M&C Saatchi to create a new campaign to rebuild its relationship with consumers, restore shopper trust in its prices and strike the right balance between quality and value.
M&C Saatchi was Woolworths' creative advertising partner between 2002 and 2012, when the retailer racked up a decade of strong food and liquor sales growth.
Woolworths has also appointed a new director of marketing, Andrew Hicks, who has been acting in the role since chief marketing officer Tony Phillips quit last May after a furore over Woolworths' Anzac Day ads.
Mr Hicks was formerly general manager marketing for Woolworths' liquor group and worked alongside Brad Banducci, now managing director of Woolworths Food Group.
Mr Banducci has previously said Woolworths' marketing strategy would slowly evolve but the key themes – fresh food and cheaper prices – would remain consistent.
Woolworths' recent campaigns have been either derided by the public (the Anzac Day Fresh in our Memories campaign) or criticised as being too reactive and similar to Coles (Cheap Cheap).
As reported on Monday, Woolworths cut its marketing spend by 5.3 per cent to $87.9 million in 2015, according to Nielsen's Advertising Information Service figures, while Coles' marketing spend fell 25 per cent to $53.6 million. Aldi's total advertising spending reached $28.9 million, according to AIS, up from $15 million in 2014.
"We're delighted to be starting a new partnership with M&C Saatchi," Mr Hicks said. "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," he said.
M&C Saatchi Group chief executive Jaimes Leggett said Woolworths was a sought-after account. "We couldn't be more excited to be back working with the Woolies team," Mr Leggett said.
Mr Hicks thanked Leo Burnett for its work over the past two years.
"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," he said.