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News Plus 28 Jul 2022 - 4 min read

Coles consolidates with Omnicom for Smith Street venture, Deloitte wildcard pays off to counter Accenture’s business transformation credentials in final tussle

By Paul McIntyre - Executive Editor

Coles first store in Smith Street, Collingwood, opened in 1914...Omnicom, Accenture and Publicis all independently proposed Smith Street as their operating venture name

In the end not even a call from Accenture Song’s global CEO and Australian expat David Droga, back down under amid the pitch for the giant Coles media, advertising and production consolidation tender, was enough to snap Omnicom’s tentacles from the Coles Group. A tactical shift mid-review by Omnicom to pull in Deloitte to neutralise Accenture’s broader business and growth transformation credentials appears to have worked.

What you need to know:

  • After a mid-review tactical shift, Omnicom has landed Coles Group’s remit to build a “specialised marketing agency” for the retailer called Smith Street.

  • Accenture Song forced a broadening of the initial Coles brief after it linked marketing and customer to Coles broader business transformation program.

  • Omnicom, after the first round of presentations, aligned with Deloitte, which, like Accenture, was already working on Coles business projects.

  • Procurement-led pricing pressures was said to not have been a material influence in the review.

  • Smith street will house about 100 people dedicated to Coles Group, including Deloitte specialists.

  • The account is estimated to be worth $25m in annual income for the winning group.

The biggest communications tender of 2022 so far is over with Omnicom’s federated model of independent operating brands still alive and a new venture by Coles to house its giant customer experience, creative services, media management and data and analytics into a single entity – along with plug-in capabilities to align with broader business transformation from Deloitte – is set for a start early next year. 

Coles released a statement yesterday announcing Omnicom would lead a “specialist marketing agency” called Smith Street – the name is derived from the location of the first Coles store and was, ironically, what all three groups, including Publicis before it exited after the first round,  landed on independently. Coles is understood to have advised all three bidders of the development and that were it to run with the name, no-one’s IP had been poached. 

Coles said Smith Street would be designed as a “Customer Centre of Excellence” and would be the catalyst for “more meaningful and personalised” customer communication, insights and reporting.

“Our marketing strategy is to position Coles as the most trusted and sustainable retailer in Australia by demonstrating our purpose through relevant omni-channel experiences, focusing on trusted value, sustainability, loyalty and health and happiness,” said Coles Group CMO Lisa Ronson in a statement. “This process has ensured we will have one lead, one home and one ambition for the Coles marketing team and will have a structure that moves at the pace of Coles customers.”  

It's a massive win for the Omnicom group but perhaps most intriguing is the mid-review jostling between Accenture Song and Omnicom. Accenture and Deloitte have business transformation projects underway inside the Coles Group and Accenture forced a broadening of the initial communications brief from Coles Group as it linked the marketing, communications and customer remit to a broader growth agenda. 

That forced a rethink from Omnicom and an alliance with Deloitte after the first round of pitches, to neutralise the interest coming from Coles on Accenture’s strategy. Like Accenture, Deloitte was already working inside the Coles Group on business transformation projects. 

The benefit of a consulting firm in the mix is the likelihood of the marketing and customer remit being more closely linked to influential operations within Coles like merchandising and stores.

Smith Street will have around 100 people servicing the Coles group with production capabilities the biggest new revenue stream for Omnicom – DDB already handled much of the retailer’s creative remit and OMD held media. Deloitte is also expected to have a handful of people housed inside Smith Street, likely to be based at OMD’s offices in Melbourne.

Coles General manager of Brand, Digital and Design, Samantha McLeod said: “Smith Street will operate as a world class network of creative and media experts with a unified goal and agenda to achieve Coles strategic outcomes, rather than a group of different agencies operating independently, which will lead to more impactful and effective communications and interactions with our customers.” 

Smith Street’s board representatives are:

Lisa Ronson, Chief Marketing Officer, Coles Group

Samantha McLeod, General Manager Brand, Digital and Design, Coles Group 

Kate Bailey, General Manager, Media and Sponsorships, Coles Group

Peter Horgan, CEO, Omnicom Media Group 

Andrew Little, CEO, DDB

Sian Whitnall, CEO, OMD

Kimberlee Wells, CEO, TBWA

Mike Napolitano, Managing Director, DDB

Katherine Battle-Schulz, Partner, Deloitte Digital

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