The troubled Nissan Motor Co. is close to signing a contract that will consolidate its $1.1 billion global advertising account at TBWA Worldwide.
TBWA will manage the assignment from Tokyo through a joint venture it formed last week with Hakuhodo. Robert LePlae, account director on Nissan at TBWA/Chiat/Day, Playa del Rey, Calif., will relocate to Tokyo to steer the global business.
A spokeswoman for Nissan's Infiniti division said the Omnicom Group agency will handle advertising globally for both the main Nissan brand and the luxury car division, pending final negotiations and approvals by executives in Tokyo.
The consolidation grew out of a desire by Nissan's new chief operating officer, Carlos Ghosn, to have one decision point for global account management and to build a global image for the automaker. TBWA and Hakuhodo agencies will continue to handle creative from local offices around the world.
The Interpublic Group of Cos. agency now known as Lowe Lintas & Partners Worldwide is also believed to have made a pitch for the business with sibling media shop Western Initiative Media Worldwide. But Lowe apparently backed out after its merger with Ammirati Puris Lintas to avoid a conflict with General Motors Corp. Automotive consultant Larry Light, CEO of Arcature, Stamford, Conn., has worked with Nissan on the consolidation plans.
HAKUHODO HAS ASIA
Hakuhodo currently handles Nissan advertising in Japan and non-English-speaking Asian nations. TBWA currently handles Nissan in North America, South Africa and countries such as Australia, Hong Kong and New Zealand.
In Europe, TBWA has handled Nissan with Hakuhodo in a decade-old joint venture headquartered in Amsterdam. That venture handles Austria, the Czech Republic, France, Netherlands, Norway, Spain and the U.K.
With the global consolidation, TBWA adds Germany and Italy, as well as Latin America, the Middle East and Canada.
TBWA formed the venture with Hakuhodo because the latter's strong ties to Nissan executives in Japan gave it a leg up in the review.
While Nissan will spend an estimated $1 billion on advertising this year, that could drop as much as 30% next year as the money-losing company moves aggressively to close plants and cut costs. In a strong economy where other Japanese car manufacturers such as Mitsubishi have staged strong comebacks, Nissan continues to experience slow sales.
In addition, the company plans to grow through the launch of a flurry of new vehicles, including a revised version of the sporty Datsun Z series in 2002.
The global consolidation may not represent a huge billings increase for TBWA since it already handled Nissan in many areas of the world. But it does cement the agency's ties to the marketer at a time when many observers believed the relationship was vulnerable. The win is also important to TBWA's goal to be viewed as a strong global network rather than a loose collection of agencies around the world.
In the U.S., there has long been turmoil and talk about trouble with the Nissan account. Most recently, Ed Sheehy, Nissan's director of marketing in the U.S., left as part of a wave of layoffs. Mr. Sheehy this summer renegotiated TBWA's contract to add an incentive clause based on sales. On the TBWA/Chiat/Day side, Rob Siltanen, who oversaw creative on the Nissan account for North America, is leaving to set up his own shop.
Contributing: Laurel Wentz
Copyright December 1999, Crain Communications Inc.