Coles parts ways with UM picking OMD for its media account
One of the biggest advertising accounts in Australia is set to change hands after 12 years with Coles set to dump incumbent UM in favour of OMD.
Wesfarmers is set to move the media spend for its supermarkets, Coles Liquor and Coles Financial Services business out of the Mediabrands agency to Omnicom’s OMD, which won a three-way shoot out with UM and ZenithOptimedia.
Mumbrella revealed the pitch was in motion in January, despite moves by UM’s parent company IPG Mediabrands to head off a competitive tender.
In 2011 Mediabrands moved the Coles business to a standalone agency called MBThree, however that was short lived as the business and agency were rolled back into UM Melbourne two years later, with MBThree’s head Peter Butler named managing director of Mediabrands Melbourne and leading the Coles business.
However he moved from Mediabrands at the end of 2015 to head up Publics’ Mediavest fledgling Melbourne office. Industry speculation suggests Butler was to move over to ZO to work on the account if it won.
Mediabrands had also made personnel moves during the process with former Coles and Woolworths marketer Tony Phillips joining as a consultant.
The account move comes nine months after former UM CEO Mat Baxter announced he was leaving the agency locally for a job of global chief strategy and creative officer with the agency.
The move add considerable buying bulk to OMD’s Melbourne office which boasts the likes of Heinz, RACV and Mazda among its clients.
“thrilled”: Margie Reid
Margie Reid, OMD Melbourne managing director, said: “OMD are thrilled at the opportunity to work with the Coles. Working with Coles over the past few months has demonstrated their vision and approach of creating true partners and working in collaboration. We can’t wait to get stuck into their business together.”
Nielsen figures released today show Coles supermarkets had a media spend of $48m in the year to April, significantly behind rival Woolworths which spent $74m in the same period.
It has also moved away from newspapers and magazines slashing its spend in those mediums by three quarters in the early part of the year, as it pushed more cash into digital.
The move is understood to be effective as of July 1.
UM has been approached for comment.
The statement from Coles:
After a full media review and competitive tender, Coles is pleased to announce the appointment of OMD Melbourne as its new media agency partner.
From July 1, OMD will take full media responsibility for all Coles businesses including Coles Supermarkets, Coles Financial Services, Coles Online, Coles Express, Liquorland, First Choice and Vintage Cellars.
“We are excited to join forces with the team at OMD to optimise Coles’ media planning and negotiations,” said Coles Marketing Director George Dymond.
“OMD’s insights, audience understanding and integrated recommendations clearly demonstrated that they are a driven bunch who know the media landscape well and can leverage positive results for Coles.”
“As part of this change we say goodbye to Universal McCann and we thank them for their unfailing support and dedication over the last 13 great years.”
Peter Horgan, OMD Australia CEO, said: “We are proud to be working with such a sophisticated client in George Dymond and the team at Coles. I am incredibly proud of the team, and this partnership underpins the consistency and depth of OMD’s offering across our offices.”
Margie Reid, OMD Melbourne Managing Director, said: “OMD are thrilled at the opportunity to work with the Coles. Working with Coles over the past few months has demonstrated their vision and approach of creating true partners and working in collaboration. We can’t wait to get stuck into their business together.”
No real surprise there.
Mediabrands have lost their mojo amd havent seen anything from D Bass that shows he knows how he gets it back. Not easy when all the good people have left
Well done OMD
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What about the programmatic spend?!
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Bad news for UM, hopefully OMD won’t continue to be impossible to work with as a publisher.
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This is a seismic win for OMD, so congratulations to them. UM have now lost their two biggest clients in Fed Gov and Coles in the last year. Tough times indeed.
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Bye bye Bakers Delight as an OMD client! Assuming that pitch will be called soon.
The boost in staff is dramatically going to change the size of OMD. I wonder if it will impact the culture, as it used to be quite a nice smaller “big” agency in that office.
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Great news Margie Reid- Best in Business! What was it that UM said when you left Margs?
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Great result for OMD, well done to them. Tough Times for UM and Mediabrands, loss of Coles and Fed Gov indicates things are not right at all at UM and Mediabrands.
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Seems the new era of Mediabrands is not going well. They have lots of work to turn around, hope they can do it.
Well done to everyone at OMD.
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I guess Coles want a media agency and not a ‘Creative Connections Agency’.
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One wonders whether IPG’s recent withdrawal from the SMI pool had anything to do with this decision? Only agency in Oz now not accessing this pool data and maybe clients want their agency to have more and not less visibility into market dynamics.
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OMD used to be great. Now its just a beige, talent less corporation that puts their revenue first and the client media plan a distant second. Just because you win some clients doesn’t mean you are great, it just meant they were experts at rolling themselves in glitter.
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