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STILL TRAILING LEXUS, MERCEDES LAUNCHES NEW CAMPAIGN

Has It Diluted Its Brand With 39 Models?

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DETROIT (AdAge.com) -- Mercedes-Benz USA breaks its biggest brand blitz since its $45 million "Falling in Love"
Trailing Lexus for the last two years, Mercedes' new campaign is the latest effort to catch up.
push in 1997 tonight on national broadcast and cable TV.

"Now is the perfect opportunity to express our leadership in the luxury segment," said Dave Schembri, vice president of marketing at the DaimlerChrysler unit.

Expanded protfolio
The brand has expanded its portfolio from 12 models to 36 since 1994 and now competes in all nine luxury-vehicle categories.

But some observers suggest this very expansion may be hurting Mercedes.

'Diluting' brand?
John Bulcroft, president of consultant Advisory Group, said Mercedes tried to broaden too widely, citing last summer's launch of the entry-level C230 sports coupe with a $25,615 base. "They're

The C230 sports coupe is the cheapest Mercedes.
becoming all things to all people and very surely are diluting the quality of their brand."

Mercedes was the nation's top-selling luxury brand in 1999. It missed a repeat by under 500 units in 2000 to Toyota Motor Sales USA's Lexus, which won again in 2001. BMW of North America was second.

Mercedes lags behind Lexus and other competitors in several owner surveys from consultancy J.D. Power & Associates.

The four-spot push, tagged "Unlike any Other" will get its biggest national TV weight through mid-April, then two-week buys in each of the following three months. Mercedes spent $116 million on measured media in the first 11 months of 2001, according to Taylor Nelson Sofres' CMR.

Unlike the past, Mercedes will provide co-op funds to 70-plus regional dealer ad groups that agreed to use seven other spots created by Omnicom Group's Merkley Newman Harty, New York.

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