Kiwi retailer Farmers cuts jobs after outsourcing marketing services

Farmers has reduced the size of its marketing team. Photo/File.

Retailer Farmers has cut some of its in-house marketing staff after outsourcing part of its marketing work to Auckland advertising agency 99.

This comes after a pitch at the end of last year that saw a field of competing agencies narrowed down and led to Farmers running 99 and its parent company, the Clemenger Group, through due diligence in the early part of the year.

The decision to again appoint an ad agency marks a shift from Farmers' strategy, which has seen it take a large chunk of its advertising work in-house, establishing a large creative department made up of photographers, Mac operators, digital marketing specialists and more.

By outsourcing some of these services to the Clemenger Group, Farmers does not need quite as many boots on the ground within its business.

Farmers marketing boss Nicky Dunn would not go into specifics but did confirm that there were "some job losses" and that the team was smaller than previously.

"The move to outsource our creative work means we no longer need creative support to the extent we needed it a year ago," said Dunn, who last year took over as the marketing boss from Dean Cook, who had been with the business for 21 years over two stints.

She added that Farmers still retains substantial in-house creative services and continues to have a large marketing team.

Former Farmers staff who find themselves without a job do, however, have the opportunity to bounce back relatively quickly.

The Herald understands that the Clemenger Group is in the process of recruiting 11 staff to work on the demanding Farmers advertising account.

It is expected that at least some of the staff who previously worked at Farmers will transition into these jobs.

In explaining the move, Dunn told the Herald that Farmers made the decision to produce "world-class creative" and also to develop capabilities in data analytics and customer experience.

The agency 99 has long had a strong reputation in the retail space, working with brands such as New World, Mazda, Spark, Pizza Hut and Kiwi Property among others.

In more recent years, 99 has also placed increased emphasis on customer analytics, working closely with Clemenger-owned data firm Perceptive to garner a stronger understanding of how customers shop.

The decision by the retailer to shift from the in-house to agency approach again raises the long-running question of which is better.

An industry source told the Herald that these issues tend to be cyclical, with companies shifting their approach as needs change. The source also said that doing your own marketing is often easier said than done for many businesses.