Lisa Ronson departs one of the biggest CMO roles, but how to mark her Coles scorecard?
Welcome to a Friday edition of Unmade. Today, a couple of thoughts on the departure of Lisa Ronson, one of the country’s most high profile chief marketing officers, from Coles.
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Three years in the hotseat
So what to make of this week’s slightly mysterious resignation of Lisa Ronson from Coles? I say mysterious, because she hasn’t yet announced her next move although there have been a couple of hints.
Ronson’s departure is a big deal within the media and marketing industry for three reasons.
First, it’s a big job; Coles is one of Australia’s bigger companies anyway, and being in the business of talking to consumers every single day, one of the most active.
Second, not every CMO is willing to speak in public as often as Ronson is. The number of CMOs with a big job who are also willing to go on stage is relatively small, so every action they take is amplified. Sometimes the accusation is that CMOs do it to build their personal brands, but its inarguable that if there were more marketers like Ronson and incoming Telstra marketing boss Brent Smart who are prepared to explain themselves publicly, then the complex role would be better understood.
Third, it comes a very short time since Ronson upended Coles’ agency arrangements with a major full service pitch which saw the exit of Big Red, the Ted Horton agency behind the red hand and a lot of the Coles production capabilities.
It’s worth being upfront here. Some of the usual metrics for a report card on Ronson are meaningless. Marketers can be judged by metrics like sales, brand health and in the case of listed companies, share price.
But Ronson’s stint, which began in mid 2019, was mostly dominated by the Covid emergency. Sales rocketed during 2020 for all the supermarkets. That makes the impact of Coles’ marketing compared to that of direct competitor Woolworths and smaller players like IGA and Aldi, harder to define.
For what it’s worth though, the Coles Group share price is up about 50% since Ronson joined - from around $13 to just above $19. Yesterday the company hit $19.38, the highest share price since it listed in its own right in 2018 as part of the Wesfarmers demerger. Admittedly, Woolworths is up by about 80% in the same period. And taking the more normal trading period of the year to date, Coles is up by about 8% and Woolies by 2%.
Marketers’ reputations are also sometimes defined in the wider industry by the fame of their ad campaigns, even if that is sometimes a less meaningful business measure. Award winning ads don’t always mean sales or long term brand health.
However, advertising is the most visible of the marketing functions when we can’t see things like growth in data capability or team development.
One reason I haven’t written much about Coles in recent months is that I haven’t particularly admired the direction of its advertising, but that’s felt like a subjective judgement.
Under then chief marketing officer Simon McDowell (these days he’s the chief operating officer of Bunnings), Coles’ advertising became some of the most talked about - and sometimes disliked - work in the market.
The daggy big red hand ads, featuring British rock group Status Quo and created by Big Red, redefined the supermarket wars. There was little danger of them winning advertising awards, but boy were they were effective.
McDowell’s Coles owned the territory around the pricing battle. There was a coherence to the Coles advertising. The big red hand underpinned value. Jenny the new staff member, was how new products were introduced. The little red car signified the company’s insurance brand (which has since faded from view).
Coles was also assisted by a tailwind. Woolworths’ marketing was well off its game back then. The decision to give the Woolies advertising account to the shiny new Droga5 Australia was a failure. Then there was the strategically disastrous relaunch of the Woolies loyalty card, and the tactically disastrous Anzac Day “Fresh in our Memories” campaign.
Arguably some of McDowell’s victories came from avoiding the sort of blunders happening at Woolworths at the time.
By the time Ronson took the helm at Coles, Woolies had got its act together. The Woolworths Rewards tie in with Qantas Rewards is powerful.
Given the Ronson’s star rose in the industry thanks to her time at Tourism Australia and the multi award winning spoof Crocodile Dundee movie campaign, it seems fair to at least partly judge her work by the advertising. And in that respect, her time is a disappointment. There’s been no single piece of advertising work that redefined the brand in the way that the big red hand did.
One major change in the advertising direction was the new “Value the Australian Way” brand positioning, introduced by Thinkerbell and launched in a DDB ad in 2020. There is an argument that having the word “value” is important now we’re in a cost of living crisis, but it hasn’t cut through in the way that Woolworths are the fresh food people
Then there was the holdco pitch, which had bumps along the way including the exit of WPP from contention after conflict of interest with Woolworths emerged.
DDB faced the fight of its life to hang on to the creative business, while sister agency OMD took the media as part of the creation of a new bespoke Omnicom in-house agency for Coles, Smith Street. There were rumblings that members of Ronson’s team had unsuccessfully campaigned to keep Big Red involved.
What was never clear was how things would have worked if the Accenture team - which included The Monkeys, sister agency to Droga5 - had been successful, given the scale required for retail marketing.
It seems odd that having only recently wrapped up the pitch, Ronson will not be the one to see through the new team’s implementation. Three years is about the minimum time to come into a role as big as that, make a mark and then move on without it looking a bit short.
We’ll only find out down the track how long she’s known she was on the move. The team at Smith Street will no doubt be wondering whether they’ll be defending the business in two or three years time when Ronson’s successor decided to review his or her options.
And one other dimension to consider. The new and exciting battleground is retail media. The hire of Paul Brooke to run Coles Media earlier this year looked, from the outside, to a catchup effort on the further advanced Cartology from Woolworths.
However, that move completed Ronson’s reshaping of her team. It does seem soon for her to be moving on. I don’t think we know the full story yet. It may become a little clearer when her next move emerges.
Unmade Index drops for third day
The Unmade Index of ASX listed media and marketing stocks fell for a third day in a row on Thursday.
Yesterday saw Seven West Media fall by 4.76%, although this was unrelated to news of the company’s tie in with Antony Catalano’s real estate venture View Media Group, which broke after the market had closed for the day. Mind you, at the time of sendign this at Friday lunchtime, the SWM price has dropped another couple of per cent.
HT&E, which reported decent results yesterday, was the best performer on the Unmade Index, up by 8.17% 9and another 7% today). More on that in tomorrow’s edition of Best of the Week
Time to let you count down to the weekend.
I’ll be back with Best of the Week at 10.10am tomorrow for our paying members, and at 11.10am for everyone else.
Have a great afternoon