Sainsbury’s makes AMV pay for ‘Value’ failure

Sainsbury’s is attempting to recapture its image as a high-quality food retailer with the launch of a 25m branding campaign this summer through M&C Saatchi.

The move – which involves axing Abbott Mead Vickers.BBDO as the retailer’s lead agency – marks the end of the unpopular “Value to Shout About” price led campaign. It featured John Cleese hectoring staff and has been panned as a serious error of strategy.

The agency switch is a bitter blow to AMV, which is left with the 20m press and promotional part of the retailer’s 43m account after 20 years on the business.

The loss comes weeks after AMV barely managed to hold on to a large slice of its BT business. The failure of the Sainsbury’s Value campaign has put the creative reputation of the UK’s top agency under the spotlight.

Creative director Peter Souter, who replaced founding creative David Abbott, recently bolstered his position by hiring BMP DDB creative director Tony Cox (MW March 11).

AMV also faces a threat to another of its biggest advertisers, Volvo. The car brand is in the process of being bought by Ford. Assuming the deal goes ahead, Volvo will be put into Ford’s new Premier Automotive Group, which has just appointed former BMW boss Wolfgang Reitzle as vice-president. Other brands in the group include Jaguar, Lincoln and Aston Martin. Ford uses agencies Young & Rubicam, J Walter Thompson and Ogilvy & Mather, and it is possible one of these may pick up the lucrative Volvo work.

AMV says the loss of the Sainsbury’s business will not lead to redundancies. The agency may have another chance to create a branding campaign in October if M&C’s strategy is not well-received. But if it succeeds, it could give M&C the chance to win the whole account.

Some in the ad industry have criticised the agency switch, saying the campaign was created by AMV at Sainsbury’s insistence and that AMV is paying for mistakes that were not of its making.

Sainsbury’s managing director Dino Adriano admits the Value campaign “failed to meet its sales targets”, because although the number of customers visiting the stores increased, shoppers spent less money. The campaign was criticised for alienating Sainsbury’s core middle-class shoppers, and encouraging people to go to the stores just for bargains.

The move comes as Sainsbury’s cut its main board from 14 to 12 and parts company with finance director Rosemary Thorne and special projects director David Clapham, who is retiring. A replacement for Thorne will be announced soon.

Sainsbury’s first hired M&C to work on the launch of its bank in December 1996. In August last year, the agency undertook an internal communications project aimed at making staff more customer-focused. According to one version of events, it developed a new brand campaign in the process, which it took to chairman Sir George Bull, who was looking for an alternative to the Value campaign. But marketing director Kevin McCarten says he met M&C partner Maurice Saatchi and account manager Tim Duffy in July to discuss the internal project, and that Bull was not consulted until some months later.

Results from Value were weak – like-for-like sales growth in the period was 1.2 per cent, comparing poorly with Safeway and Tesco, which had reported growth figures of three and four per cent respectively, while Asda was also thought to have done well.

The new campaign will aim to turn those figures round by making Sainsbury’s, in the words of McCarten, “more accessible, less prim and proper and less aloof”.

The brand positioning, says McCarten, has been decided, although a strapline has yet to be chosen.

McCarten, who admits that errors were made in advertising the Value to Shout About campaign, says the new executions will attempt to push the value for money idea while returning to Sainsbury’s traditional quality and choice-led positioning. He adds: “We need to make sure we present quality, choice and value for money in an integrated way and not be schizophrenic about it. The bias will not be towards value. It will lead on quality and choice.”

Analysts have given tentative approval to the change in strategy after criticising Value to Shout About for departing too far from customer perceptions.

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