Dan Murphy’s has hired one of Coles’ top executives as its new managing director, Alex Freudmann.
Freudmann has 20 years experience in the retail industry, having led customer-focused change in both the Australian and the UK markets. He has worked for Coles for the last 10 years, and for Tesco in the UK for six years before that.
He was appointed to his most recent role as Director of Fresh Food at Coles in March 2018, as the company prepared to demerge from Wesfarmers. Over the past year he has overseen the development of new store formats, tailored ranges and new operating models.
Endeavour Drinks MD Steve Donohue (below) said: “The team at Dan Murphy’s has been working exceptionally hard at re-establishing sales momentum while also strengthening key foundational areas to better serve changing customer needs in a challenging market.
“The business has a long history of success with strong customer loyalty, however rapid market changes require us to transform Dan Murphy’s for sustainable long-term growth. For this reason, we’ve taken the time to conduct a thorough search for the right person to help us lead Dan Murphy’s into the future.
“Alex has expertise in leading initiatives that have delivered significant improvement in customer experience and he has a proven track record for responding to market disruption and changing customer preferences.
Freudmann will be responsible for driving Dan Murphy’s F20 strategy.
According to Donohue, this will include re-establishing Dan Murphy’s differentiated customer value proposition in the drinks market, focused on value, range, discovery, convenience and personalisation.
“He will lead Dan Murphy’s transformation from being a store-led to digitally-led organisation, with a lean and flexible operating model,” Donohue said.
Donohue added that a start date for Freudmann will be communicated in due course.
Faye Ilhan will continue her interim leadership of the Dan Murphy’s team until Freudmann joins Endeavour Drinks.
“In a short space of time, Faye has helped the business focus at pace on key priorities to progress the Dan Murphy’s transformation,” Donohue said. “We have also benefited from her prior knowledge of the Dan Murphy’s business and her expertise in digital innovation from the wider Woolworths Group.”
Dan Murphy’s performance “below expectations” in HY19
Woolworths announced plans to reposition Dan Murphy’s following the release of its HY19 results in February.
Brad Banducci, Woolworths Group CEO, said: “Endeavour Drinks’ sales increased by 1.8% and EBIT decreased by 6.4% [to $290 million] with Dan Murphy’s below expectations in a low-growth market impacted by cooler and wetter weather around key events and the timing of New Year’s Eve.
“Steve Donohue has assumed the role of interim managing director of Dan Murphy’s and will continue to work with the team to position Dan Murphy’s for the next horizon of growth. We have a clear plan in place focused on localised ranging, building ‘discovery’ into all aspects of the customer experience and being digitally-led.”
Banducci also noted that Dan Murphy’s was struggling to open new stores and that consumers were drinking slightly less, trading down and demanding more convenience.
“We saw material trading down from champagne to sparkling wine, which flowed through the results,” he said. “It’s not a business that needs to be turned around but needs to be reshaped for the future.”
The company noted that further progress on this agenda was expected in the second half, but Endeavour Drinks’ EBIT for FY19 was expected to be below the prior year.