SAFEWAY LOOKS FOR NEW 'INGREDIENTS' IN ITS ADVERTISING

JON SPRINGER

PLEASANTON, Calif. - Safeway's ballyhooed "Ingredients for Life" branding effort is searching for a new head chef.

The retailer here last week said it would conduct a competitive review for a new advertising agency and that it would leave Dailey & Associates - its agency of record for 11 years and creator of its "Ingredients for Life" campaign - by the end of the year.

Mike Minasi, Safeway's senior vice president of marketing, told SN last week the company was "very happy with the positioning and very happy with the success of the advertising campaign," which was launched a little over a year ago to accompany Safeway's lifestyle store makeovers. However, he said, "we feel there's an opportunity to look at other resources that might be able to support us in a different way."

Safeway said it has engaged Boston-based Pile & Co. to conduct a competitive review for the $250 million account. One source, who asked not to be identified, told SN the retailer is likely hunting for a "bigger, sexier" agency than Dailey.

Few food retailers have put a stronger emphasis on brand image than Safeway, which is counting upon developing a unique identity for its store and products to provide a point of difference in the marketplace. "Ingredients for Life," an integrated campaign including television, radio and outdoor advertising, a new website and new logo design, launched last April and was notable for highlighting Safeway as a broad lifestyle solution, rather than focusing on "price and item" advertising typical of grocery stores.

"Ingredients for Life," would continue to be "the centerpiece of consumer communication," that Safeway brings to its new agency, Minasi said.

Dailey & Associates, West Hollywood, Calif., has been Safeway's agency of record since the company acquired the Von's chain in Southern California in 1996. Von's had been a Dailey client before then.

Brian Morris, chief executive officer of Dailey, told SN last week that he was "stunned" by the news that Safeway would change agencies, and puzzled as to why his firm was not invited to participate in the review.

"The reasons for firing us are still hazy in my mind," Morris said. "I know we had a lot of success. The repositioning work was more than an advertising campaign; it was a whole new approach to marketing. It was going well. And our work seemed to be well-received.

"We weren't told it was performance related, and I don't think it's relationship related, and those are the typical ways an agency can get fired," Morris added. "I think they just want a fresh start."

The $250 million figure represents billings through the agency and is not Safeway's total ad spend, Minasi said, preferring to keep the latter confidential.

Some observers said the agency change came as no surprise given Safeway's brand emphasis and marketing focus. Bill Bishop, president of Barrington, Ill.-based Willard Bishop & Associates, speculated that Safeway would look to a larger agency because those are the firms familiar to Brian Cornell, the former Pepsi executive installed as Safeway's chief marketing officer.

"You can see his fingerprints all over this," Bishop said of Cornell.

In addition to the competitive benefits of what Bishop called "creating an uncontested area" through brand-building, the notoriety associated with a bigger agency - and the better visibility it might provide - could also have a positive impact on Safeway's stock price, Bishop added.

"I think [CEO] Steve Burd believes Safeway can raise its stock price through marketing - and give them credit for being the first with that," Bishop told SN. "Frankly, Wall Street likes that kind of stuff."