Subaru's Japanese management, which has taken an increasingly active role in the U.S. operation over the last two year's, has, according to these sources, not made a final decision yet about whether to hold a review, or simply move the account to another agency.
Those same sources confirmed that representatives of Dentsu America, which was a finalist for the account in the 1991 review, has recently made at least two visits to Subaru's New Jersey headquarters.
Dentsu's executives couldn't be reached for comment, nor could Subaru's senior American executive, Chuck Worrell. Subaru ad manager Mark Dunn, though, denied that a review or change of agency was in the offing.
Calls to John Marchese, who heads the Subaru account at W&K, and to Dave Luhr, the agency's director of account services, were not returned. But the signs of unrest and unhappiness on the account at the agency are clear. Luhr and the original Subaru copywriter Jerry Cronin headed back to the safe haven of W&K's Portland, Ore., headquarters before the launch of the Impreza. But they have since been joined in Portland by Vince Engel, the head creative on the account, who was hired shortly after the agency won the account specifically to work on Subaru. However, one source stressed that Engel moved because of founder Dan Wieden's desire to circulate W&K employees throughout its three-office network.
Sources close to Subaru and its Japanese parent, Fuji Heavy Industries, said that the relationship between client and agency has been deteriorating for several months, especially from Fuji's vantage point, but that the underwhelming launch of the Impreza has brought the relationship to the breaking point.
Dunn said the sales target for Impreza is 5,000 a month--but the company has done about half that, despite spending in excess of $40 million in ads since the beginning of the year. Dealers report that the light traffic which was generated during the national ad flight has already begun to fade, prompting Subaru to channel its remaining budget of about $40 million into retail ads and incentives for the rest of this year.
This year industry figures show Subaru's total sales off 14%. And the company recently reduced production of its Legacy model.
Said Dunn last week, "I would have to say that the communication between us, the agency and our dealers has not been good, and should be improved."
That seems to be an understatement. Wally Preble, one of Subaru's top-four dealers last year, who is based in W&K's backyard in Beaverton, Ore., said last week that the agency has never paid a call on him. "This is an arrogant agency that just doesn't seem to be interested in our business," said Preble.
Copyright Adweek L.P. (1993)