Asda, don’t tell us you’re passionate about food too…

When five of the six biggest clients in the supermarket sector review their business in two years, you’ve got to wonder what’s going on, says Dominic Mills, and explains that what supermarkets really need is not cheaper advertising, but better strategic creativity…

By and large, the giant supermarkets are reluctant to review their advertising arrangements.

Apart from the bother of fending off all those pesky agencies chasing their chunky marketing budgets, moving the highly complex piece of business that comprises a supermarket’s advertising from one agency to another is a lot harder than it looks. It’s also highly disruptive to everyday business.

That is why supermarket agency reviews are relatively rare. But not in the last two years, when there seems to have been a clutch.

This summer two major players – Morrisons and Asda – have reviewed their business. Asda announced last week that it was moving its £100 million account to VCCP, and a few weeks earlier Morrisons decided to keep its business with DLKW Lowe . (Big congratulations to DLKW Lowe, by the way, because retaining a large piece of business, especially a supermarket, is probably sweeter than winning one).

Last year saw Tesco move to Wieden and Kennedy, and the Co-op hire Leo Burnett; and in 2011 Waitrose moved to BBH. All told, that makes five big reviews in two years.

As a rule, clients review their advertising for reasons specific to their own performance. But when five of the six biggest clients in one sector (Sainsbury’s and its near 30-year love affair with AMV the exception) review in two years, you’ve got to wonder what’s going on.

Clearly, the sector is in a state of flux and the pressure felt by supermarket managements is obviously being passed down the food chain (er, no pun intended) to suppliers including ad agencies.

Normally, this is a matter of squeezing down prices, which is the supermarkets’ default position. This time round, however, what the supermarkets need is not cheaper advertising, but better, preferably brand-oriented advertising – or to put it another way, some strategic creativity.

Never before, as far as I can see, have the supermarkets needed as big a helping of this.

Think about it: the hierarchy and positioning of supermarkets used to be pretty straightforward a few years ago. Sainsbury’s and Waitrose were posh. Tesco was mid-market. Asda, Morrisons and the Co-op were lower middle market (probably in that order). Aldi and Lidl were downmarket.

Now everybody’s trying to be everything. The posher ones have added downmarket ranges and stress quality and price. Tesco has tried to go upmarket and downmarket at the same time; Morrisons has looked to go upmarket, as has the Co-op. Aldi and Lidl win prizes for their products. No wonder they worry about their positioning.

And Asda, to misappropriate Ed Miliband’s phrase, looks like it’s in the squeezed middle.

Supermarket advertising generally divides into two discrete categories: sexier, more strategic stuff about positioning (e.g. Waitrose and Heston Blumenthal’s popcorn ice-cream); and more prosaic, classic retail if you like, stuff about price like this clunker from Asda.

The trouble is that supermarkets, when in doubt, or under pressure, or struggling to meet this week or this month’s sales figure, bung out the price-led message. According to Kantar Worldpanel, Asda, Morrisons and Tesco have all dropped market share in the last three months, which offers some explanation for all this agency reviewing.

It says pretty much everything about Asda that it’s hard to remember a decent brand-led ad this side of Christmas 2012’s much-sneered-at number.

The trick is to find a vehicle that allows the supermarket to combine both brand and price messages. I suspect Tesco’s ‘Love Every Mouthful’ is designed to do that at some point, once the ads have established its credentials as somewhere that is genuinely passionate about food (which regular readers of this column will know I think a) as totally unoriginal and b) unlikely to happen before 2033.)

I have a sinking feeling, however, that Asda is going to start telling us how passionate it is about food, based on comments made by CMO Stephen Smith.

This is what he said last week: “We are getting noticed for quality but as a company we are so focused on price. Although it can sometimes feel a bit like puffery, we are winning awards across our entire portfolio and we have to find a way to get that message across in a commercial way and give ourselves credit for it.”

Still, if anyone can pull it off, it’s VCCP. They’ve done it for years for 02, mixing brand advertising with price.

And Asda would be well advised to give them the time. VCCP is the supermarket’s fourth agency in five years (from Publicis to Fallon to Saatchi and Saatchi), which is pretty bad going by any client’s standards. It can’t afford to screw up the agency choice again.

Supermarkets don’t seem interested in holding company deals

Sir Martin Sorrell made much of WPP’s superior skills at ‘horizontality’ during last week’s results show, talking about the holding company’s ability to put together cross-discipline, multi-agency, teams to service one client.

Indeed, from Team Ford to Bank of America to HSBC and so on, this is a trend that WPP seems to have invented and mastered.

This would be perfect, you might think, for the giant supermarkets: after all, they need it all – media, design, data analysis, digital, PR, social media and so on.

Yet they seem curiously resistant to this kind of working arrangement (and to WPP agencies altogether, which have failed to convert any of the last big pitches). In fact, they seem almost hostile to the idea of buying into any of the large network agencies, and don’t seem interested in network deals either.

Tesco’s agency Wieden and Kennedy is independent, while Asda’s VCCP is owned by Chime, a mini-conglomerate (with the accent on mini). Sainsbury’s has been with AMV since long before it became a part of Omnicom. Morrison’s is with DLKW Lowe, which is part of Interpublic but behaves more like an indie than a network, while Waitrose is with BBH, part of Publicis but definitely not a pawn in the holding company game.

I don’t really know why this is so other, perhaps, than a preference for not having all their marketing service supplier eggs in one basket.

But it is interesting nonetheless, and it suggests there are still some clients who like to go a la carte rather than the take-it-or-leave-it combo menus that ‘horizontality’ offers.