Mercedes bulks up ad $ with new dealer funds

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Mercedes-Benz USA will spend $50 million to $60 million this year on a branding campaign -- "the Mercedes experience" -- breaking Sept. 13 from new agency Merkley Newman Harty, New York.

In addition to this national campaign, the unit of DaimlerChrysler will bulk up ad spending for model-year 2000 by an additional $60 million through a 0.75% per-vehicle surcharge to dealers. These funds will be used for regional ads controlled by Mercedes.

The national branding campaign will include 10 TV spots, print, Internet and collateral material, making it Mercedes' largest U.S. campaign, said VP-Marketing Joe Eberhardt.

"That's not just in cost, but in the depth of creative we're offering," he said. "Certainly, it's a huge undertaking."


Although most ads are for the brand, one introduces the new ML 55 AMG, a high-performance version of the M Class sport-utility vehicle. Mercedes USA President-CEO Mike Jackson said the SUV, which posted slow sales early this year and has been criticized for production quality, will rebound strongly.

New brand ads emphasize employees' commitment to taking care of customers, Mr. Jackson said.

The first TV spot to be aired is called "Magic"; it depicts well-known images with one detail changed, such as a toothy grin on the Mona Lisa. The spot ends with a frame that reads: "Change one thing and it's just not the same. But when every part is right . . . Magic." Voice-over says, "Welcome to the Mercedes experience."

Two humorous spots will reinforce the theme.

The "Magic" ad breaks on cable programming, including ESPN's "SportsCenter," Major League Baseball games and CNN's "Evans & Novak," as well as broadcast shows in some markets.

Fourteen print ads are planned, beginning in October issues of


Merkley, which won the Mercedes account in March from Lowe & Partners/SMS, New York, also will handle the regional effort. The plan will not take funds from local dealer-group ad budgets, Mr. Eberhardt said.

In its national effort, the M Class is featured in the "Slingshot" spot, showing five men shot out of a giant slingshot, then cutting to the men in a fast-moving ML 55 AMG. It touts the vehicle as "the fastest SUV on Earth."

M Class sales, which revived in July and August, slumped in the U.S. earlier this year. Mr. Jackson said that was because Mercedes' Alabama plant was supplying overseas markets. With the addition of a plant in Austria, Mercedes will have capacity to meet U.S. demand, he said.

The SUV was criticized for quality problems--such as wind noise, poor fits and finishes--after J.D. Power & Associates' 1999 Initial Quality Study ranked it low among sport-utilities. Mr. Jackson said the needed manufacturing fixes have been made.

Copyright September 1999, Crain Communications Inc.

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