Tony Hoggett’s decision to leave Tesco for Amazon is a seismic move that will reverberate throughout the UK grocery sector.
He joins fellow Tesco man John Farrell and ex-Sainsbury’s and Central England Co-op executive Matt Birch in swapping a senior role in an established UK grocery business for the opportunity to be part of Amazon’s assault on the UK – and global – food and drink market.
Hoggett’s appointment is by far the most significant by Amazon to-date and puts new Tesco boss Ken Murphy in a quandary. When Tesco’s board appointed a CEO with no grocery experience it did so in the knowledge that Murphy could lean on the expertise of experienced lieutenants such as Hoggett. The CEO does not have to be the best shopkeeper in the team but they need great shopkeepers beneath them. Hoggett is one such shopkeeper, widely respected both within Tesco and across the wider retail sector.
With 30 years’ experience at Tesco, Hoggett knows all there is to know about the business. Just three months ago he was offered the carrot of a new role as chief strategy and innovation officer in an effort to retain his services. The plan has failed and Murphy has at a stroke lost 30 years of institutional knowledge. Not only that, he has lost that knowledge to a business that will surely emerge as one of Tesco’s key future competitors.
For a lifelong Tesco servant like Hoggett it must have been a wrench to leave a business he joined as a “trolley boy” in 1990, but the appeal of the Amazon opportunity is obvious. As senior vice president of physical stores, Hoggett gets to oversee what could easily become the most aggressive store expansion programme in retail history. It’s an exhilarating prospect for Hoggett as he heads towards the back end of a fine retail career.
More generally, the appeal of Amazon as a destination for some of the UK grocery sector’s best minds should give all retailers cause for concern. Amazon doesn’t do things by half measures. When it identifies a market opportunity it commits fully and delivers with pace backed by whatever resource is necessary.
Just as Farrell and Birch have been persuaded by Amazon’s grocery blueprint, a retail heavyweight like Hoggett has not been recruited simply to shake up the underperforming Whole Foods brand (albeit I’ve no doubt he’ll improve the underwhelming service that customers – myself included –frequently experience).
Acquisitions are surely on the agenda. Many commentators have been surprised that a bid for Morrisons has not been forthcoming, while Sainsbury’s, M&S Food and, most intriguingly of all, Tesco could all be in-play.
Delivering an ambitious integration and expansion programme (and don’t forget, Hoggett’s role is a global one) will require some serious experience and brain power. Amazon’s grocery rivals around the world will be looking anxiously at their own talent and thinking: ‘who next’?
Finally, it’s worth commenting on what Hogget’s move says about the esteem in which UK grocery leaders are held around the world. He joins a long list of people – including David Cheesewright, Judith McKenna, Stuart Machin and Richard Brasher to name but a few – to have been recruited by overseas retailers to fill critical positions. Most have achieved great success in their roles.
The UK produces the most respected and sought-after grocery executives in the world and as a nation and industry we should take great pride in that fact.