Coming to terms with a changing world
By the 1970s some of Woolworth's traditions looked outdated. The chain had not kept pace with rapid changes in marketplace working practices. For example at a time when people had started switching jobs in mid career, the High Street giant stuck with its tried and tested policy of filling virtually every role from within.
The Executive Directors had started their careers in the stores, or occasionally as trainee accountants. Non-Executives were only elected to the Board when this became a legal requirement, and the candidates were drawn from the firm's trusted advisers like former external auditors.
The approach was good for morale, but it left the Company blinkered and lacking an external perspective.
Finally it dawned that the firm must change or die. The Board was forced to address escalating costs and outmoded working practices. At a time of very highly inflation, sales, margins and profits had not kept pace. The workforce was restless and highly unionised. Any turnaround plan would need to win over the hearts and minds of the staff who served up to ten million customers each week, and would need to convince investors that the long-founded chain could rediscover its roots as a modern, dynamic retailer.
The Board made some good choices, selecting Peter Marsh's up-and-coming advertising agency Allen, Brady and Marsh as a key partner. ABM's services included brand identity, advertising and public relations. Rod Allen coined the new slogan 'The Wonder of Woolworth' with a catchy jingle and persuaded sceptical executives to allow the colloquial chorus 'that's the wonder of good old Woolies'. Meanwhile Peter Marsh worked on wider corporate identity, advising on everything from uniforms to shopfittings, with a special focus on investor relations and engaging the public through sponsorship and good works.
Under the Agency's guidance the Woolworth name appeared on rally cars that won races, a tall ship that set a world record in a 1976 Transatlantic Race, London Buses celebrating the Silver Jubilee of H.M. Queen Elizabeth II, and even at the Royal Tournament. Marsh even persuaded the former Prime Minister, the Rt. Hon. Edward Heath PC MP, to conduct at the Woolworth European Young Musician of the Year contest.
ABM evangelized the theory that sponsorship deals would convey the Woolworth name in a positive light to the public. They believed it would also improve the staff's pride in the brand. They were less candid about the risks associated with corporate sponsorship, but fortunately they backed a winner as Great Britain II won the race rather than sinking into oblivion.
The Agency also targeted proposals for PR to piggy-back on the television presence. For example to promote its own-brand Winfield name, the Board was advised to choose a high potential product range and market it strongly.The halo effect helped to boost perception of the brand as a whole.
The Directors took the bait, choosing fishing tackle, in a campaign nicknamed 'hook, line and sinker'. It included press advertising, sponsorship of the Angling Village at the Earls Court Boat Show, and an exclusive book by Mike Pritchard. The popular fisherman got themto go a step further and sponsor 'The Winfield Lagoon' at the Pierrepoint National Water Sports Centre.
By 1980 this achieved a dominant 50% share of the angling market ... and the Winfield name was firmly associated with worms !
Similar techniques were used to promote Woolworth's growing range of budget clothing. As well as fashion shows and traditional print advertising, public relations experts placed stories in national newspapers. These featured whole outfits, including accessories like ear-rings and watches, with editorial that highlighted the exceptional value for money of the red-front store range. ABM were particularly proud to secure the front cover of the prestigious Observer Colour Supplement.
To promote Woolworth's growing range of budget classical music, the firm sponsored the European Community Youth Orchestra, which included no less than forty young British Musicians. Former Prime Minister, the Right Hon. Edward Heath, PC MP, was enrolled as guest conductor to complement Claudio Abbado.
Woolworth also sponsored Filmharmonic '76 which celebrated music from the movies, backed by albums for sale in the stores. In-store there were also exclusive LPs from a number of popular artists including Andy Williams and Johnny Matthis.
The salvo of advertising and public relations, alongside the award-winning Wonder of Woolworth TV campaign, brought substantial increases in traffic to the stores and generated much-needed incremental sales. But it was expensive and, according to some investors, extravagant. While it brought big gains in the short term, it wasn't long before competitors were launching campaigns of their own like "Oo oo oo get some oo from Boots", which began to eat into the initial gains.
External help from ABM brought some respite from investor demands for change. But the fact remained that the Board remained largely home-grown with little or no external experience.
To redress the balance the Board co-opted Mrs. Pat Downs (right) as their first woman Director, after a training period of two years as the "first female executive." Internally they apologised for "piping in" a new manager to head their Bureau of Staff Relations, assuring Managers that she was "competent".
In 1976 a change in the law brought the first Non-Executive Director. A former external auditor was co-opted. Managers were assured that the new man had a comprehensive knowledge of the firm, even though he had not worked in-store. It seemed they planned to jump the chasm in a series of small steps!
In 1980 a new Joint Managing Director, Geoffrey Rodgers, (pictured above, centre) sought to reassure investors who had been shaken by news of the tragedy at the firm's Manchester store. He fronted a new series of television commercials personally, promoting 'Operation Crackdown', a programme of deep price cuts.
The supremo also decided to explain the firm's strategy and strengths in a series of press advertisements in the broadsheet newspapers that were most popular with company investors and city analysts. Each advert, which ran in The Times and The Financial Times, focused on a single area of the operation like DIY, Fashion or Records and Tapes, and argued that Woolworth was reinventing the variety store.
The campaign had an unplanned side-effect. Some believe that it highlighted the break-up value of the organisation and attracted the surprise takeover bid which led to a change of ownership in 1982.
After ignoring the world outside for seventy three years, all but one of the Board was swept aside, as the High Street chain prepared for a rude awakening!
The PR showcased the brand's strengths, but the Board seemed inept.
Investors saw much higher returns after the business was taken over in 1982 and overhauled more radically.
The staff soon had to face new commercial realities. The sprawling City Centre stores started to vanish from the High Street, as the management learnt the realities of 'market rent' and return on capital employed.
Shortcuts to related content in the Woolworths Museum