BMF’s managing director, Stephen McArdle, has rubbished the idea that his client, ALDI, is behind Coles and Woolies decreasing margins which was impacting ad spends.
Yesterday B&T reported that ALDI’s aggressive expansion in Australia had meant the big two grocers were tightening margins with suppliers which, as a consequence, was having an adverse effect on marketing and advertising budgets across the FMCG categories.
McArdle argued that budget stores like ALDI meant shoppers had more money in their pockets and that money was being spent elsewhere.
“I can understand those economics but I don’t really agree with it,” the new BMF boss told B&T. “For far too long Coles and Woolies have had it all their own way and you only need look around the world to see this amazing duopoly that the two have enjoyed.
“Why would people point the finger at ALDI and say they’re the problem? What has been the problem in Australia for decades has been these two huge companies that own the whole of the retail world in this country.”
A Moody’s report released yesterday showed that ALDI grew at three times the rate Coles and Woolies did in 2014.
McArdle believed the retail world was moving in a different direction in terms of what customers want and the big two had failed to keep pace.
“Consumers are jaded with Coles and Woolies,” he believed. “They’re probably a bit bored by these big two who’ve over-promised and under-delivered and not really been consumer focused. What ALDI has done is show the duopoly that Coles and Woolies have had and that we’ve been paying twice what we should for groceries.”
In terms of the campaigns themselves, McArdle said ALDI’s were “down to earth”, while he considered Coles’ and Woolies’ campaigns “brash and centred around them as a brand and what they offer”. ALDI, he added, didn’t go for that “whole celebrity chef thing”.
“ALDI like to think they don’t have customers they have fans and I think that’s a very powerful thing,” he added.
