Mel Smith Ocado CEO in van

Source: Ocado

Smith has led the 50-50 joint venture between Ocado Group and M&S since its formation in 2019

Ocado Retail CEO Melanie Smith is to depart the company after three years.

Smith has led the 50-50 joint venture between Ocado Group and M&S since 2019, when it was formed.

“After three years, now is the right time for me to move on to new challenges and I leave behind a strong business, full of energetic, amazing colleagues that have achieved so many great things and I know will take the business onwards to achieve many more,” Smith said.

“It has been a privilege to lead the Ocado Retail team over the last three years,” the New Zealander added. “In this period, we have successfully established the joint venture as the UK’s best online grocer with outstanding service, introduced M&S Food to online consumers for the first time, and played our part in feeding the nation through the Covid pandemic.” 

Smith will continue to work at the company until 31 August, when its leadership will pass to Lawrence Hene, a former deputy CEO of Ocado Retail and current chief product officer at Ocado Group.

Hene will serve “on an interim basis” Ocado said, with a permanent successor appointed “in due course”.

Smith joined Ocado from M&S where she was group strategy director for bank & services and member of the executive committee. Recalling being a key player in the negotiation to acquire Ocado Retail, Smith told her university alumni magazine: “I sat in front of these incredibly posh people for six months, negotiating to buy half the business off them, which was a terrifying experience. I just problem-solved my way through it.”

She had to be convinced by her investment banker to take the top role after the venture was formed.

“I wondered if I would even make a good CEO,” she told Ingenio. “He handed me a list of all the CEOs in the UK. I decided I could.” 

Despite struggling to meet huge demand for online grocery through the pandemic – its capacity growth limited by the long lead time in establishing new CFCs – under Smith’s leadership Ocado Retail added two new CFCs in 2021, and recommenced operations at Andover following a devastating fire in 2019.

During Smith’s time at the helm, the company has grown its rapid delivery offering Zoom by Ocado, launching a second site in Canning Town in May this year.

The company has also undergone a major brand overhaul, early last year, changing its website and logo from green to purple. It also mounted a major marketing campaign, its ‘There’s an Ocado just for you’ jingle deemed the most memorable ‘sonic logo’ of all UK supermarkets, according to an index by audio branding agency SoundOut. By the end of 2021, Ocado had increased the value of its brand by 72%, more than any other grocer, according to Kantar analysis.

Smith leaves the online supermarket with a UK grocery market share of 1.8%, according to Kantar, up 0.7% on last year. The company claims more than 830,000 active customers, and to be “the UK’s fastest-growing supermarket”.

Smith is understood to have been highly regarded by staff across the business, and claimed to know the names of every one of its 377 head office staff – less a “management trick”, she told The Grocer in 2020, than a reflection of her roots in New Zealand, where such things are “just good manners”.

During the height of the pandemic, she slept in the back of a van at headquarters and went out making home deliveries.

“Mel has steered this business through with incredible energy and I would like to thank her for all she has done,” said Tim Steiner, Ocado CEO and chairman of Ocado Retail.

“The last two years have been extremely challenging with a pandemic to contend with affecting the grocery market in ways that we could never have predicted. There is no question that Mel leaves the business well prepared for faster growth in the years to come. We wish her well in her future endeavours.”

Stuart Machin, CEO of Marks & Spencer, said: “Mel has been fundamental in establishing our joint venture and the successful switchover to M&S supply. I am grateful for the contribution she has made in this early phase. Whilst today’s market conditions are tough for everyone, we believe in the long-term opportunity of our partnership and the substantial further potential in the joint venture.”