Carat retains Woolworths $240m media account
Media agency Carat has won the Woolworths media account, in what has been the most closely watched pitch of 2014.
The decision sees Carat, the incumbent on the account, win a three way shootout with GroupM’s MediaCom and Omnicom’s OMD.
Mumbrella understands the staff of the various agencies were told late this afternoon of the decision which sees the contract for the retailer awarded for another three years.
Woolworths announced the pitch in February with a number of media agencies originally lining up for the retail business which is one of the biggest advertisers in Australia.
Originally at the helm of the pitch is head of media Helen Lecopoulos, who moved from McDonalds to Woolworths back in November, but sources have told Mumbrella that delays began occurring in March following the appointment of Tony Phillips at CMO of the supermarkets section of the business.
Phillips is thought to be have been a strong advocate of the business remaining with the incumbent Carat, which had the business transferred to it since it was last pitched from sister Aegis agency Mitchell & Partners.
In May a grenade was also thrown in the process after The Australian ran an article suggesting that the business would stay with Carat for one year. The article suggested Phillips wanted to eventually move the media business to IPG Mediabrands, which was not involved in the pitch due to the conflict it has in UM representing rival Coles.
Woolworths later denied that there had been any change to the pitch and said that the contract would be for three years.
The drawn out process has fuelled speculation that the retailer would pay the unsuccessful agencies compensation, given the work hours and hundreds of thousands of dollars of costs invested in the pitch. At this stage it is not clear whether this will be paid.
Nic Christensen
Update: Woolworths has issued the following statement:
Woolworths Limited (Woolworths) has announced its intention to appoint Carat Australia (Carat) as its lead media agency following an extensive tender process.
The appointment is subject to agreement on final contracts.
Carat will provide strategy, planning and buying services for the majority of Woolworths’ media requirements under a three year contract.
Mitchell/Carat have been Woolworths’ incumbent media agency for more than 10 years. Under the new arrangements Carat will engage a renewed and larger team to meet Woolworths’ need for greater focus on strategy and planning.
Carat has strengthened its leadership team with a number of recent senior appointments.
A good win, worth the wait I guess. Congrats Simon and team.
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Woolies win and Carat get a big pay rise. More than that Carat have now shown they can beat the biggest. Nervous CEOs at OMD and Mediacom!
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