Honda Motor Co.

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When Japan-based Honda Motor Co. established American Honda Motor Co. in Los Angeles in 1959, motorcycles were its primary line of business. The company's first U.S. ad agency, Gumpertz, Bentley & Dolan, Los Angeles, produced ads showing well-dressed people riding the small motorbikes. In 1961, Honda's first year of sustained U.S. advertising, its ad budget was $240,000.

In 1963, Honda moved its U.S. account to Grey Advertising, Beverly Hills, Calif., which introduced the tagline, "You meet the nicest people on a Honda." Honda increased its U.S. ad budget to $2.18 million.

The company quickly built itself into the leading motorcycle brand in the U.S., claiming as much as 70% of the rapidly expanding market in the early 1960s. By 1972, Honda motorcycles were receiving $3.5 million in ad support. The tagline was "From mighty to mini, Honda has it all." Honda also started marketing road bikes and cruisers to address a new market segment influenced by the movie "Easy Rider."

In 1979, the marketer established Honda of America Manufacturing to begin building motorcycles in a new facility in Marysville, Ohio. That same year, Honda switched its motorcycle and power products accounts to Dailey & Associates, Los Angeles. The new slogan for the 1979 motorcycles—"Honda, follow the leader"—capitalized on Honda's market position.

Complementing the motorcycles was a lineup of scooters and all-terrain vehicles, which were becoming popular in the U.S. Through the 1980s, Honda introduced a series of new cycles; 1988 saw a $75 million ad push with the tagline, "Come ride with us."

Entering the auto market

In 1968, Honda was preparing to enter the U.S. auto market and assigned its auto account to Chiat/Day, Los Angeles. Grey, which worked for Ford Motor Co. on autos, retained Honda's motorcycle business.

Chiat/Day's ads for the 1970 model 600 were tagged, "New little car in town." Annual spending on the car account was $2 million by 1972, when 12,000 vehicles were sold. That year, using network TV for the first time for its auto campaign, Honda introduced the Coupe, a car even more diminutive than the 600. The campaign targeted 18-to-24-year-olds, poking fun at the idea of keeping up with the Joneses.

In 1973, the Honda Civic arrived in the U.S. Although small, the Civic was a larger and more refined car than either the 600 or Coupe.

Advertising began in March 1974 and touted the fact that the car ranked highest in the U.S. Environmental Protection Agency's mileage rankings. The tagline, "More miles per gallon than anybody," hit home during the U.S. energy crisis, when most American-made cars had abysmal gas mileage. In late 1974, the marketer moved its auto account to Needham, Harper & Steers, Los Angeles.

In 1975, Honda introduced its high-tech, clean-burning CVCC engine in the Civic and, at the same time, curtailed production of its older, mini cars. Ads focused on the CVCC engine technology and touted the Honda Civic as "What the world is coming to."

Sales jumped dramatically, and by the end of the year Honda offered a version of the Civic that was the lowest-priced car on the U.S. market, wresting that title from rivals Toyota and Datsun. Honda's 1975 U.S. sales were up more than 145% over the prior year, to 102,383 units.

In 1976, the automaker introduced the larger Accord with a print campaign that proclaimed, "A little bigger car from Honda." The ad occupied four consecutive color pages. The first spread featured the Civic, the second, the new Accord. As Honda's U.S. auto sales increased another 47%, filling demand became an issue, and the company began considering the possibility of building cars in the U.S.

First U.S. auto plant

In 1981, Honda announced plans to produce cars in the U.S., the first Japanese company to do so. The decision to build plants in the U.S. came as Honda's U.S. car sales had declined slightly for two consecutive years owing to import restrictions imposed in 1980 on Japanese auto manufacturers.

In 1986, the automaker launched the luxury Acura division with two models, the Legend and the Integra, and $24.5 million in advertising handled by Ketchum Advertising, San Francisco. The tagline was "Precision crafted automobiles—from a new division of American Honda."

First year Acura sales were 52,869 units; in 1987, the number more than doubled, as did the division's ad budget. In 1989, Acura was challenged by upscale divisions of both Toyota (Lexus) and Nissan (Infiniti). For 1990, Acura ad spending hit $100 million, but the division's sales peaked in 1991 at 143,708 units. In 1996, the account moved to Suissa Miller, Santa Monica, Calif.

By 1986, nearly 70% of Honda's worldwide revenue came from its overseas markets, with approximately 50% of that from North America alone. That same year, the Honda account moved to Rubin Postaer & Associates, Santa Monica. (In 1999, Honda consolidated its entire auto account with Rubin Postaer, moving its Acura business there as well.)

By the end of 1989, U.S. auto sales for the two divisions had reached 783,102 units and the Honda Accord became the best-selling car in the country—the first foreign-branded model to do so. The Accord ad theme for 1989 was "You have to drive it to believe it."

In 1993, Honda made its first tentative steps into the growing U.S. light truck market with an agreement to sell rebadged American Isuzu Motors sport-utility vehicles. Honda increased its total U.S. ad spending by 39.5% in 1994 to nearly $500 million. In 1997, Honda launched its own small SUV, the CR-V, in the U.S., revamping and updating it in 2001.

In 2002, the Honda division launched five new models, including a hybrid version of the Civic. The automaker strengthened its truck lineup with two new SUVs—the midsize Pilot and, late in the year, the Element, aimed at men 18 to 35 years old.

For 2003, Honda Motor Co. ranked No. 26 among U.S. advertisers, spending $1.14 billion, down 4.1% from the year before, according to Advertising Age. On Honda vehicles, it spent $486.6 million, down 8.2% from 2002, and on Acura vehicles, $221.9 million, up 6.3%.

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