John Lewis, Tesco, Nectar: 5 things that mattered this week and why
From the decision to merge John Lewis and Waitrose’s marketing teams to the surprise departure of Tesco’s CEO and digital Nectar plans, catch up with all the key marketing news from this week in our handy round-up.
John Lewis and Waitrose merge to become the ‘Future Partnership’
John Lewis and Waitrose is merging its operations from February 2020 to become a single business under a new strategy to be known as the ‘Future Partnership’.
It is all part of their parent company the John Lewis Partnership’s (JLP) strategy to bring the two brands closer together and accelerate its plans to differentiate amid ever-challenging retail conditions.
This involves cutting 75 of its 225 top management jobs and creating a smaller partnership board made up of a chairman and seven executive directors. The Future Partnership strategy is expected to lead to a cost saving of around £100m.
JLP believes integrating John Lewis and Waitrose will allow it to deliver better products and services for customers, as well as strengthening the influence of customer-facing staff in shaping its offer.
And from a branding perspective, it seems to make sense. Since John Lewis and Waitrose rebranded last year to add ‘& Partners’ to their names, JLP has been trying to better align both brands’s marketing – including new visual identities, a new tagline and joint marketing campaign.
Operationally, it might be a little trickier, given the very different nature of both retailers. But there are certainly opportunities to deliver a more consistent customer experience in-store and online, as well as make better use of each other’s capabilities and improve on areas such as click and collect.
The impact of the restructure on John Lewis’s and Waitrose’s marketing teams will not be known until the consultation period is complete. Will jobs be lost? Will there be one marketing team or two?
Whatever happens, this will be the responsibility of John Lewis’s current managing director, Paula Nickolds, who is taking on the new role of executive director of brand. EH
READ MORE: John Lewis and Waitrose to merge in restructure that puts marketing jobs at risk
Dave Lewis checks out of Tesco
In an unforeseen retail plot twist, Tesco’s chief executive ‘Drastic’ Dave Lewis will leave the UK’s largest supermarket next year.
It’s for personal reasons, Lewis says, and because he believes the turnaround he set out to do is complete. Although it is perhaps no coincidence that it comes as a no-deal Brexit clouds the horizon.
Lewis has arguably saved Tesco from supermarket oblivion. When he left Unilever in 2014, he took on a business that was about to post one of the biggest ever corporate losses in the UK (more than £6bn).
Since then he has reduced net debt, brought Tesco’s value and quality perceptions back from an all-time low of almost zero, moved into the lucrative wholesale space with the acquisition of Booker, and launched Jack’s discount chain to try and compete with Aldi and Lidl (although the success of Jack’s remains to be seen).
Lewis says he is leaving a “significantly stronger” business than when he joined but admits there is more to do. This will be the job of Ken Murphy, chief commercial officer of Walgreens Boots Alliance, who will take on the top job next summer.
Murphy doesn’t have any specific grocery experience but neither did Lewis when he joined. However, while Murphy inherits a much stronger business than Lewis did, he still has a lot of challenges: from the continued rise of the German discounters, to the potential outcomes of a no-deal Brexit.
It will be interesting to see whether Murphy continues in Lewis’s footsteps or decides to do it his own way. He has some big boots to fill, but he has four decades of retail experience to fill them with. EH
READ MORE: Tesco CEO Dave Lewis steps down, saying turnaround ‘is complete’
Sainsbury’s takes Nectar scheme digital
Sainsbury’s has overhauled its Nectar loyalty programme in a bid to boost engagement with the scheme.
The “fully digitised” new-look Nectar includes a revamping app and website where shoppers will be offered more personalised offers based on their past buying habits. They will also be offered deals from Nectar partners, such as eBay.
The move comes in the same week Tesco revealed plans to introduce a subscription element to its Clubcard loyalty scheme in a bid to attract more big shoppers. For £7.99, shoppers will be able to receive 10% off two shops worth up to £200 every month (a potential saving of £40) and gain access to improved deals in its mobile and banking business.
The new loyalty products suggest a market in which retaining shoppers is becoming increasingly difficult. Sainsbury’s hopes to overcome this by getting shoppers to engage more regularly, while Tesco wants to take more big shop spend.
Whether either works is another question. Paying for loyalty might be a step too far for many, while other loyalty schemes (here’s looking at Waitrose and Marks & Spencer) have been criticised for being too complex.
Brands are always looking for new ways to engage around loyalty. Really all people want is to earn points for money spent and maybe get the odd free coffee. It’s best to keep it simple. SV
READ MORE: Sainsbury’s overhauls Nectar with shift to digital loyalty programme
Meatless Farm hires new CMO to capitalise on growth
Meatless Farm means marketing business. It has hired former Coca-Cola marketer Lone Thomsen as its first CMO, taken on funding from Channel 4 to help fund its first TV campaign and is setting up local marketing teams in markets where it is looking to expand.
Thomsen has been charged with growing the Yorkshire brand both at home and abroad as it looks to supercharge its growth amid growing interest in meat-free products among both vegans and those looking to cut down their meat consumption.
Meatless Farm is already available in supermarkets across the UK and Wholefoods in the US but is looking to expand that footprint. Thomsen is also keen to build the brand’s digital footprint and wants to work closely with finance in order to ensure marketing is seen as “an investment not an expenditure”.
Having come from Coke, Thomsen will be bringing the FMCG giant’s fast-paced innovation process to Meatless Farm. She will also be concentrating on renovating products, growing marketing teams (both in the UK and US) and creating a clear marketing strategy.
Just one week into the job, much is still to be done. Especially if it wants to live up to its purpose of reducing consumers’ red meat intake. MF
READ MORE: How Meatless Farm’s first CMO will use her experience at Coke to build the brand and business
Greggs, Tesco and Britvic win big at the Marketing Week Masters Awards
Marketing Week’s annual awards celebration took place at The Brewery in London this week, attended by some of the best in marketing, as well as host Adam Buxton.
It’s a chance to take stock of some of the work from the past year and learn from the best, as well as mingle with others in the industry.
Big winners this year included Greggs, which took home Brand of the Year; Britvic, which won the Grand Prix for its ‘Robinsons Revitalise’ strategy; and Tesco, where chief customer officer Alessandra Bellini deservedly won ‘Marketer of the Year’.
After a stellar year of work for brands including KFC, Elvie and Ikea, Mother was crowned ‘Agency of the Year’. And The Guardian and Huawei walked away with at least two awards each.
Congratulations to all the winners, those highly commended and everyone that made that shortlist amid stiff competition. See you next year!
READ MORE: Greggs, Tesco and Britvic win top prizes at the Marketing Week Masters Awards