Volkswagen takes some new agencies for a test drive

Not long after one seemingly solid agency-client partnership came to an end when 2degrees shifted from TBWA\ to Special, another seemingly solid agency-client partnership is also up in the air, with Volkswagen putting its business up for pitch.

DDB’s chief executive Justin Mowday had no comment when asked about the pitch and the reasons for it and Volkswagen marketing manager Michael Cope was unable to be contacted. But it’s thought the incumbent will be battling it out against Colenso BBDO and Assignment.

Assignment worked on Hyundai for years, but it recently lost the above-the-line part of the account to Shine, which had been doing its digital work. Volkswagen is distributed by the Giltrap Group, so it’s interesting that Assignment is in the mix given its long-time connection to the competition. But it has certainly shown its automotive stripes, having helped take Hyundai from a brand that used to be perceived as a Korean van and wagon manufacturer to one of the top country’s most popular brands. 

Volkswagen is one of DDB’s global clients, and the agency made its name on the account in the 1960s with classic ads like ‘Think Small‘ and ‘Lemon‘. So there’s plenty of history there, plenty of global assistance to call on, and probably quite a bit of confidence that the local branch can keep it. But if there is the will, clients can certainly go against global alignments, as evidenced in this market by the likes of Vodafone choosing DraftFCB over a WPP agency or Cadbury choosing to work with DDB rather than Saatchi & Saatchi.

In New Zealand, the Volkswagen brand has been going from strength to strength, to the point where it won the supreme TVNZ-NZ Marketing award last year for taking the brand “from niche street to main street”. So it’s slightly surprising to see it up for pitch. 

Research showed VW was seen as “cold and bland” and “not in tune with the Kiwi lifestyle and with how we use our cars”. It was also seen as being too expensive and European. But a combination of high-profile sponsorships, aggressive pricing, a brand strategy based around ‘a car for every Kiwi’, the successful launch of its Amarok ute and more localised comms changed that perception very quickly.

Volkswagen HQ in Germany agreed to put the money where the local team’s mouth was for the bespoke advertising, which proved that you could change the habits of a multi-national if there’s a thorough and well-considered case to back it up. And they liked what they saw: ‘Milk Run’ was used at the beginning of a board meeting in HQ as an example of “a great piece of Volkswagen humanity in its advertising”. 

In 2009, Volkswagen had registered total sales of 1,913 vehicles. But the new strategy produced immediate dividends, with sales increasing by 17 percent in 2010 to 2,233 vehicles and by 49 percent to 3,329 vehicles in 2011. 

This 49 percent year on year growth came at a time when the total market only grew by five percent between 2010 and 2011. And even without the Amarok, the year on year increase for Volkswagen was still 30 percent. 

Volkswagen’s goal is to sell 4,000 vehicles by 2014. And it almost got there two years ahead of schedule. In 2012, total sales were 3,905 (up 13 percent year on year). And it made it into the top ten for new passenger car sales with a total of 2,910, up 14 percent.

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