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INSIDE EURO RSCG'S JAGUAR ACCOUNT WIN

Successful Volvo Ad Work Sealed the Deal

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NEW YORK (AdAge.com) -- Struggling luxury automaker Jaguar Cars Ltd., which has been without a consistent marketing plan and has seen sales continue to slip, last week turned to an ad agency credited with developing a clear and meaningful positioning for one of Jaguar’s sibling brands -- and the most successful member of Ford Motor Cos.' Premier Automotive Group -- Volvo.
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Six-month review
The automaker's six-month-long agency review wrapped up March 24 with the selection of Havas’ Euro RSCG Worldwide to handle global advertising duties for the luxury brand. Euro RSCG's win was a "combination of four things: a shared strategic vision for the brand; creative spark; positive personal chemistry; and their proven ability to use nontraditional media," said C.J. O'Donnell, executive vice president of marketing, sales and communications for Jaguar Cars North America.

Mr. O'Donnell said Ron Berger, the ad agency's CEO for New York and San Francisco, and Jeff Kling, executive creative director of the New York office, “nailed the strategy” during the agency's presentations.

Volvo endorsement
Jim Heekin, Euro RSCG Worldwide's chairman-CEO, said the agency's work on Volvo was a contributing factor in the win, and that Jaguar executives contacted Volvo executives, who gave favorable reviews. “But we created an idea that was about Jaguar, and fortunately they felt as strongly about it as we did,” Mr. Heekin said. “It is terrific.”

Euro will set up a new unit within Fuel, its Volvo-dedicated agency, to handle Jaguar and will create a London-based unit as well.

Euro will use its agency-within-an agency, New York-based Fuel, which was built for Volvo, on the Jaguar account, and will create a Fuel unit in its London office as well.

Downmarket move
Jaguar, despite its status as a high-end, well-known car brand, has suffered in recent years from declining sales and financial losses. Part of Jaguar’s problem, critics say, was its move downmarket with the launch in 2001 of the entry-level X-Type, which alienated many loyal customers. What’s more, communications programs did not address Jaguar’s very different markets in North America (which accounts for roughly 45% of worldwide sales), Europe (roughly 40% of sales) and other parts of the world (10% to 15% of sales).

“They’ve not fine-tuned” their messages to address their different constituencies in the past, one consultant said.

Jaguar sold about 42,000 cars in the U.S. in 2004.

Shift away from TV ads
Mr. O'Donnell said ads for North America will have specific creative for the region, but some creative may be used globally. The first work should break this summer, most likely for Jaguar’s XJ sedan and XK coupe and convertible. Spending will focus on those flagship models, plus the S-Type sedan. In the coming year, Jaguar intends to shift more money into magazines, newspapers and online from spot TV, Mr. O’Donnell said.

Spending in measured media in 2004 was $138 million in the U.S. and is estimated at $150 million globally, according to TNS Media Intelligence.

The Jaguar win is a boon for Euro RSCG, which in January opted out of the $300 million global review for chip maker Intel, ending a 14-year relationship. Other recent wins for Euro include Charles Schwab in the New York office and LG Electronics in London. Euro contributes about 70% of revenues for parent Havas, which just reported positive 2004 results after a tough 2003.

"The past six months have been extraordinary," Mr. Heekin said.

Blow to WPP
Meanwhile, the agency decision was a blow to Havas rival WPP Group, which has a long relationship with Jaguar's parent Ford Motor. Jaguar's incumbent agency was WPP's Y&R, Irvine, Calif., which was cut earlier in the review, and two other WPP shops, JWT and Berlin Cameron/Red Cell, participated in the review and lost out.

WPP and Ford forged a global preferred supplier deal in 2004 aimed to optimize the holding company's resources of its 100-plus agencies for Ford in exchange for what the carmaker called "favored nation rates." Ford was WPP's biggest client worldwide; in 2002 the automaker accounted for 9% of WPP's $5.9 billion in global revenue, according to Advertising Age estimates.

Jaguar said its relationships with WPP's MindShare, Wunderman and MediaEdge:cia remain unchanged.

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