On and Off Track: Goldberg Drops Out of Porsche Race; Three Shops Remain in Running By Daniel S. Levin

In a surprise 11th-hour decision, Goldberg Moser O'Neill last week removed itself from the Porsche Cars North

The withdrawal, which puzzled GMO’s competitors, left Goodby, Berlin & Silverstein/S.F., Stein Robaire Helm/L.A. and The Richards Group/Dallas to vie for the $10-million account, considered a plum for any agency.
GMO said it withdrew from the review because it was already straining under the task of absorbing three new accounts it won in recent weeks: Stuart Anderson’s Black Angus Restaurants, new age flavored water marketer Aqua Vie Beverage Corp. and a financial services firm the agency would not name. That, combined with an increasing workload from existing clients, prevented GMO from properly preparing for the Porsche pitch, the agency said.
‘It was a very difficult decision,’ said Fred Goldberg, ceo of the firm. ‘We didn’t have enough resources to deal with Porsche.’
The remaining firms made their presentations at Porsche’s Reno, Nev. headquarters on Wednesday and Thursday. Some of the contenders knew about GMO’s withdrawal going into the presentation. Others were told during the meeting.
The presentations were scheduled for three hours each and were made to nine Porsche executives from marketing and advertising, dealer groups and sales. Representatives from the German parent were present as well.
The agencies were asked to share their thinking on how best to launch the revamped Porsche 911. The car is viewed as an interim measure to carry the market for the troubled automaker as it prepares to bring out its new, lower priced roadster called the Boxster in 1995.
Porsche specified that it did not want to see any creative for the review.
That didn’t stop GBS from working up some mock ads. But instead of showing them to Porsche, GBS showed them to target customers to help refine a strategy to sell the cars. What they learned was there’s an opportunity to move the car beyond its current image as a symbol for conspicuous consumption. ‘They have to make the car accessible to people,’ said Rich Silverstein, co-chairman and co-creative director for GBS, who is a Carrera owner. ‘It’s not just a showy, fast car. There’s more depth to it.’
SRH seems to have taken a similar approach, arguing that in the mid-1980s, Porsche was embraced as a status symbol and it must now reconnect to its roots and position itself as a choice for the automobile enthusiast.
The Richards Group appears to be the only agency that sent an emissary to Porsche’s Reno headquarters on Monday prior to the shop’s presentation to review the approach it planned to take. ‘There’s an enormous pent up demand for Porsche that’s out there,’ said Stan Richards, a principal with The Richards Group. ‘It’s the role of advertising to unleash that demand.’
Richards said Porsche indicated that the shop was on course at that early meeting, but would not offer other details on the the shop’s presentation. A source close to the review said Porsche executives indicated that Richards approach was off the mark.
For the agency that captures the Porsche account, winning it will likely be the easy part. The auto manufacturer faces a plethora of problems that industry experts say advertising will not likely be able to cure.
Since peaking in 1986 with annual sales of about 30,000 units, Porsche U.S. sales have plummeted to just 4,100 in 1992, according to J.D. Power and Associates, an Agoura Hills, Calif. auto consultancy. Porsche, which had captured 2.4% of the luxury car market in 1986, now claims less than .4%
‘They’re just absolutely dying,’ said Thad Malesh, a senior consultant with J.D. Power, who said the economy, a newfound financial conservatism and broad range of lower priced alternatives have conspired to eat away at Porsche’s market. ‘I don’t think it has anything to do with image.’
Article includes a brief chart on Porsche’s sales and luxury car market share, 1992 vs 1986
PORSCHE’S ROUGH ROAD
How Porsche’s Sales Declined from Their Peak 1986 1992
Units sold: 30,000 4,100
Share of luxury market: 2.4% 0.4%
Source: J.D. Power and Associates
Copyright Adweek L.P. (1993)