Tecate Consolidates U.S. Advertising With Mexican Agency

Cost-Cutting Move Follows Other Global Consolidation Efforts

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In a cost-cutting move, Heineken's Tecate beer brand is moving U.S. advertising from Kirshenbaum Bond Senecal & Partners' U.S. Hispanic unit Ramona to its longtime Mexican agency, Olabuenaga Chemistri, the brewer told Ad Age .

The consolidation means all Tecate and Tecate Light U.S. advertising -- including digital -- will be run from south of the border, an unusual arrangement for a brand sold in the U.S. Tecate, a Mexican import, was already an oddity among advertisers for focusing its entire U.S. account on the Hispanic market, particularly Mexican immigrants and Mexican-Americans. However, the brand lately had been testing a limited number of English-language ads.

It is the loss of a key account or Ramona. The agency did not return a call for comment this afternoon. Olabuenaga Chemistri, on the other hand, gains its first foothold in the U.S. market. The agency, based in Mexico City, has experience with several high-profile accounts, including work in Mexico for Bacardi and General Motors, as well as Mexican milk brand Leche Lala.

While Heineken's push for global synergies drove the move, Tecate considered the creative consequences, said Tecate VP-Marketing Felix Palau. "If we found out there was any risk in switching to a single creative approach coming from Mexico, we [were] not going to conduct [the] move," Mr. Palau said. "But that was not the case."

Indeed, Heineken reviewed new proposals from both Olabuenaga Chemistri and Ramona before making the switch, he said. Under the new arrangement, the same Spanish-language ads will air in Mexico and the U.S. But Olabuenaga Chemistri will also create English language ads to air in several U.S. markets in the Southwest.

Tecate is the fourth-largest U.S. import behind Corona Extra, Heineken and Modelo Especial, according to 2010 rankings from Beer Marketer's Insights, the latest available. But the brand has been slipping, with grocery-store sales down 8.38% in the year ending Dec. 25, according to SymphonyIRI, which excludes Walmart Stores and liquor stores. Heineken USA spent $17 million in measured media on Tecate and Tecate Light in the U.S. in 2010, according to Kantar Media.

Ramona has had Tecate since 2007, when it was called Adrenalina and partly owned by MDC Partners. The agency was formed specifically for the Tecate pitch and all three partners at the time had worked with Eduardo Casas, the then-Heineken USA executive leading the review. In 2010, the agency was absorbed by MDC Partners sibling Kirshenbaum Bond Senecal & Partners following the departure of the last of Adrenalina's three founders, Manuel Wernicky. Adrenalina was renamed Ramona in 2010 when Sandra Alfaro, a management partner and director of account management at Vidal Partnership, was hired as general manager.

Under Ramona, Tecate last year sought to expand from its traditional base of new U.S. immigrants to more acculturated Hispanics by adding humor to its ads.

Going forward, Tecate will keep its "con caracter" tagline, which positions it as the drink for men "with character," Mr. Palau said. But ads will be tweaked to ensure they work in Mexico and the U.S. For instance, U.S. ads now tend to overtly play up Hispanic notions of character that Mr. Palau said even border on U.S. stereotypes of Hispanic men. "This new campaign and this new creative approach doesn't necessarily talk about the difference between a Hispanic manifestation of character and a more universal manifestation of character. Now we are talking to a broader base of Hispanics [so] it's less relevant to say 'I'm Hispanic.' The fact that Tecate is a Mexican beer and they will see Hispanic talent in the ads, that 's more than enough."

The agency switch follows other maneuvers by Amsterdam-based Heineken to seek synergies. In November, the brewer launched a review to consolidate its global media planning and buying under one shop, pitting roster shops Starcom MediaVest of Publicis Groupe and WPP's Mindshare against each other. Heineken has also streamlined procurement. And last year it appointed independent shop Wieden & Kennedy as global creative agency for its flagship Heineken brand.

Olabuenaga Chemistri is co-owned by Ana Maria Olabuenaga and Jorge Cuchi, who is the chief creative officer. The agency has a partnership with Publicis Groupe that gives it access to some of the company's resources, including agencies such as Leo Burnett Hispanic shop Lapiz, which is based in Chicago. Olabuenaga Chemistri is said to be considering hiring people from Ramona to help service the account, and might keep some presence in New York.

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