VOLKSWAGEN RETOOLS BRAND IMAGE IN U.S.

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Volkswagen is poised for a comeback try in the U.S. market.

The German auto importer's new campaign, said to be themed "Drivers wanted," will play a crucial role in determining whether VW can build a brand image that sustains it for the long haul.

"This is a real turning point for them," said Jesse Snyder, president of Snyder Research, a Moorpark, Calif., consultancy. "VW has to make a go of it in North America in order to position themselves as a healthy automaker worldwide."

It's a big moment for Arnold Fortuna Lawner & Cabot, the Boston agency that shot to national attention when it nabbed the $90 million to $100 million U.S. and Canada account this spring (AA, April 3). And the campaign is equally important to the VW management team that took over North American operations last year, led by Clive Warrilow, president-CEO.

That's why Auburn Hills, Mich.-based Volkswagen of America is going all out to hype the new ad campaign. Dealers are being flown into Detroit for a preview of the advertising this afternoon at the city's restored downtown movie palace, the Fox Theatre. Then VW executives head to New York for a media briefing the next day.

"The whole approach of the campaign involves defining our customer and how best to reach them in terms of media," said Ben Hulsey, a Houston dealer who was part of VW's agency selection team.

Mr. Hulsey said the campaign is intended to communicate not only to consumers but to dealers "who we are and who we're selling to" in order to "get dealers on the same page."

The campaign is said to communicate a more youthful, fun image, and will make heavy use of TV to reach young buyers. At the same time, the "Drivers wanted" theme will also emphasize the performance aspects of the company's models.

Sales in the U.S. already are on an upswing, driven largely by a $199-a-month leasing promotion for the Jetta sedan. VW sold 13,916 units in the U.S. in June, its highest monthly mark in five years. The June surge was led by the Jetta, with its sales of 8,968 units representing a 32% bump up from the same month a year earlier.

For the first half of 1995, VW's sales were 59,227 units, an 18% jump from the year-ago period.

"To this point, we've done it without brand-building advertising," said Mr. Hulsey, who predicted the new campaign will add that important element.

One reason VW may be able to sustain a U.S. comeback is that its German parent is able to give more attention to this market. Concept One, the stylistic throwback to the Beetle, will debut later this decade in North America rather than in Europe, where most of the company's products are introduced.

"The company has spent most of the '90s fighting a rearguard action to keep its U.S. dealer organization intact while VW digested its expansion in eastern and southern Europe," Mr. Snyder said. "Now, the U.S. organization is getting some support from Germany, and they're getting their production problems [at an assembly plant in Mexico] straightened out.

"It looks like they can be competitive again."

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