Magazine article Marketing

Mark Kleinman on Marketing and the City: Bowed but Not Broken

Magazine article Marketing

Mark Kleinman on Marketing and the City: Bowed but Not Broken

Article excerpt

Marc Bolland's decision to take up the reins at M&S does not necessarily spell disaster for Morrisons.

Until a couple of weeks ago, and for the first time in at least a decade, all of the UK's 'big four' grocers were heading into the Christmas trading period with reasons to be cheerful.

Asda, Sainsbury's, Morrisons and Tesco, had the City more-or-less onside (although Asda, a subsidiary of Wal-Mart, is not separately listed, it does provide data about its trading performance to analysts).

There are, of course, caveats about the long-term performance of the big four. Questions inevitably arise about how long Tesco can sustain its juggernaut-like sales growth in the UK (the pounds 70m Clubcard promotion announced this week was a sign of an increasingly aggressive approach to protecting its market share). At Sainsbury's, there is scepticism about how effective its move into non-food retailing will prove to be, but for Morrisons, the problems are more real and immediate.

Marc Bolland, Morrisons chief executive, has just been poached by Marks & Spencer to take the helm when Sir Stuart Rose becomes non-executive chairman in the New Year. On the day the move was confirmed, the City gave an unequivocal verdict on the value of Bolland: M&S' share price shot up, while Morrisons' sank as investors digested the news of his departure.

Be in no doubt - marketing is at the heart of this shift in the upper echelons of British retailing. Bolland (along with his marketing chief Angus McIver) has brought some coherence to Morrisons' brand strategy for the first time since the company acquired Safeway in 2004.

His international experience running Heineken meant that Bolland's decision to relocate to Bradford to run what had, until a short time before, been a regional English supermarket chain was welcome, if highly unexpected.

Bolland's appointment may be good news in the short term for both Asda and Sainsbury's: Andy Bond and Justin King, their chief executives, were seen as contenders for Rose's job, despite having publicly ruled themselves out. The uncertainty over their intentions was causing some nervousness.

However, does Bolland's resignation necessarily spell the kind of disaster for Morrisons often prompted by the departure of a successful chief executive? It need not, for several reasons.

The customer-facing parts of Morrisons' business are in decent shape Its advertising strategy now looks like that of a confident national retailing brand, rather than a provincial operator unsure of consumer tastes in the South East. …

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