Automaker Accused of Setting Up 'Bogus' Shop

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DETROIT ( -- African-American ad agencies and activist the Rev. Al Sharpton are crying foul over Nissan North America's choice of a newly formed agency to handle its $15 million to $20 million urban account -- the second recent controversy over an automaker's selection in a multicultural review.

Contenders for the Nissan business charge that the New York-based True Agency, incorporated two months ago and minority-owned by Omnicom Group's TBWA/Chiat/Day, Los Angeles, unfairly had the inside track for the business. TBWA/Chiat/Day handles Nissan's general-market account.

Certification pending
Advertising Age magazine has also learned that True is not minority certified, a requirement in the review. True applied for minority certification in June and its application is pending, according to a representative of the New York-New Jersey Minority Supplier Council. Certification normally takes 60 to 90 days.

Eugene Morris, chairman-CEO of minority-certified E. Morris Communications, Chicago, and an early contender for the account, said he will complain to Rev. Jesse Jackson, president of the Rainbow/Push Coalition, about the choice of True.

"It appears Nissan already decided what it was going to do" in the review, which began in March and was originally set to end in late May, he said. "Nissan waited until this agency got everything in order, then named them. It's OK for them to do it. It's their business. Just don't drag legitimate agencies though the process."

Rev. Jackson couldn't be reached for comment by press time.

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Rev. Jackson and Rev. Sharpton questioned Chrysler Group after the automaker allowed an agency coalition with Peter Arnell and Steve Stoute's uncertified PASS Entertainment, New York, into its multicultural pitch. PASS had been tipped to win the business, but last week Chrysler named incumbent GlobalHue, Southfield, Mich., for its $140 million account. PASS, in one of three finalist coalitions, did not pass muster for minority certification.

"Why have minority certification if it doesn't mean anything?" Rev. Sharpton said. "As we move from the Chrysler review on, we are starting to see a disturbing pattern, that is why we are talking to attorneys and considering litigation. ... The Nissan thing undermines having minority businesses. It really is saying that [marketers] are completely making a mockery of the pursuit of minority inclusion in the business community and we can't tolerate that.

'Bogus' outfits
"[Nissan] is trying to avoid ... doing business with minorities by setting up bogus minority outfits, so they can appear to be doing what is proper when in fact they're not doing that at all -- they're doing business with the same agency," he said.

Steve Wilhite, vice president of marketing for Nissan and Infiniti, said he had not spoken to Rev. Sharpton, but said True is not a bogus agency.

"That's just nonsense." He said he is sorry contenders feel the review wasn't fair, adding "it was a very rigorous and thorough process." He said the review panel "was fairly unanimous" in voting for True as the winner after the final pitches. "I'm very pleased with the process and the outcome."

Robert LePlae, president of TBWA Playa del Ray, Calif., and San Francisco, would not comment other than to say his agency is aiming "to offer the best support to Nissan."

Creative ways to keep accounts
Clifford Freeman, president of Final Phase Marketing's Fuse, St. Louis, one of four Nissan finalists, said the company's move reflects an escalating trend. "[General-market] agencies are trying to hold onto the business and are coming up with creative ways to keep the business in the family," he said. "You don't see African-American agencies getting major pieces of business."

Mr. Freeman said that up to 75% of his agency's work is created for the general market. "African-American agencies are in trouble because the big agencies trot out expertise saying they have urban insight."

The other finalists in the Nissan pitch were Matlock Advertising & Public Relations, Atlanta; and DBA Otis Advertising, Chicago, an agency formed earlier this year by Otis Gibson, a former creative at Bcom3 Group's Leo Burnett, Chicago, on the U.S. Army account.

Mr. Wilhite conceded "there could quite possibly be some criticism" over the choice of True with TBWA/Chiat/Day as a part owner. "Chiat was an enabler, capitalizing the business [for True] and getting it started," he said, adding that the agency is "enabling a bright, enthusiastic group of people to start a new agency on a substantial account."

Ties to exec
At least two True executives have ties to Nissan's Jon Cropper, hired five months ago in the new post of senior manager-youth and urban communications. Mr. Cropper introduced True to TBWA/Chiat/Day executives and asked True to pitch the account, said an executive close to the matter.

Claude Grunitzky, co-managing partner at True, said True was incorporated two months ago. Before it was formed, the three men sent Nissan a 32-page booklet called "True Black" outlining his "trans-cultural" philosophy and later received a request for proposal, he said.

Mr. Wilhite said that while Mr. Cropper knows True's leaders, "it certainly didn't give them the inside track."

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Richard Linnett contributed to this report.

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