BMW eyes others; Pat storms off

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The decade-long union between BMW of North America and the shop that created its lauded and groundbreaking Internet films unraveled last week as the automaker's new VP-marketing informed Fallon Worldwide it was calling a review, prompting agency founder Pat Fallon to resign the $160 million account.

The end to one of advertising's most storied creative pairings was first reported on AdAge.com on June 17 and came a scant two months after Jack Pitney, 42, succeeded James McDowell in the post he held for 12 years. It hits during an unusual wave of creative reviews by automakers in the past year including Subaru of America, Kia Motors America, Mitsubishi Motors North America and Jaguar Cars. Media-buying reviews were called by General Motors Corp. and Volkswagen of America.

Publicis Optimedia, New York, will continue to handle BMW's media; a BMW spokeswoman said the media account isn't in review.

The agency set a high bar for online brand marketing with its award-winning and much-copied BMW Film Series, "The Hire," which bowed in 2001. Fallon created a comic-book series of "The Hire" in a deal with Dark Horse Comics with a bound compilation due later this year.

"They tell us ... after 10 years they want to make sure that they have the best resources available," said Pat Fallon, chairman of the Publicis Groupe agency. Citing "10 years of a brilliant partnership where the ... results have been I would say at the very top end of the category, consistently, quarter after quarter after quarter," Mr. Fallon said, "we don't believe there's a need for a review." He touted the agency's 3 Series launch work, now in various media, as hugely successful.

THE CONTENDERS

Mr. Pitney was unavailable for comment; the BMW spokeswoman said only, "It's been 10 years and we have a lot of new models coming out."

There is no shortage of contenders likely to try to jump into a pitch for a plum auto account, including Interpublic Group of Cos.' Deutsch, Los Angeles (incumbent in the Mitsubishi review before it pulled out); Omnicom Group's GSD&M, Austin, Texas (in the finals for Kia and, before dropping out, Subaru); WPP Group's Berlin, Cameron/Red Cell, New York (finalist in Jaguar and participant in Subaru); MDC's Kirshenbaum Bond & Partners, New York (Kia finalist) and Interpublic's TM, Dallas (Subaru contender that later dropped out).

Mr. Pitney, who was previously VP-sales and marketing for BMW sibling Mini USA, may also invite MDC's Crispin Porter & Bogusky, Miami, into the mix. The agency has created buzz for Mini's account, mostly with nontraditional marketing. Mini used Roth Associates to hire its agency; the BMW spokeswoman said she didn't know whether it is using a consultant in the current review.

Frank Ursomarso, a former dealer-council chairman, was surprised when told about Fallon resigning. "I have not been unhappy with BMW's brand advertising," said the Delaware BMW dealer, nor had he heard any other dealers complain about Fallon creative. "I know there's a lot of pressure at BMW to keep costs low," he said.

BMW's parent company reported revenue for its global automotive arm slid by 2.2% and its profit before taxes fell 5.4% in 2005's first quarter vs. a year ago. The German automaker cited the weakness of the U.S. dollar vs. the euro as one of the main reasons.

In the U.S. the BMW brand saw its vehicle sales fall 1.3% through May to 99,472 units compared to 100,821 units a year ago, according to Automotive News.

Fallon's Publicis sibling Chemistri, Troy, Mich., handles General Motors Corp.'s Cadillac and Pontiac while Publicis' Starcom Mediavest won GM's $3.4 billion media-buying account last month. Asked whether Fallon wants another car account, its chairman responded, "we love the category."

contributing: james b. arndorfer

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