Getting the bugs out By David Kile

Last January, while the rest of New York shivered, Andy Berlin and three colleagues from DDB Needham flew to Nassau. There they would meet some chilly Midwesterners--executives f

He brought along videotapes of VW ads from around the world, and he directed his two creatives on board to present ideas for the launch of new Golf and Jetta models to the clients. With anti-sea-sickness bands strapped to their wrists, the sailing party took off for its 80-mile cruise.
They didn’t get far. An earlier storm had left the waters choppy, causing the boat to pitch violently. A clock radio flew off a shelf, cold-cocking DDB creative John Starfen. As the bow slapped against the water with each swell, VW division head Tom Shaver and ad manager Greg Stein queasily watched the video monitor. The third VW executive, marketing director Dave Schembri, excused himself and retreated to the head, looking ashen. “Good idea, this bonding session,” Tony Wright, DDB’s account executive for VW, told Berlin. After 30 stomach-turning minutes, a chastened Berlin turned the boat back to the harbor, where the meeting could continue in calmer waters.
In truth, the day on the boat was a bad experience for reasons other than the weather. The ad sketches positioned the VW brand, rather than the new products. “A lot of warm and fuzzy stuff,” says co-creative Mike Rogers, “which, of course, was completely wrong, and they let us know it.” Moreover, while the videotapes showed what DDB was capable of abroad, it made the work that had been done for the U.S. market pale that much more.
Berlin was more adept in the coming months at changing direction but staying on course—his course being to keep his primary client satisfied and within the Omnicom Group, if not inside its DDB subsidiary. At the same time, he was supposed to rebuild DDB’s New York office, win some new business, and keep other existing clients at the agency. This was a tall order, even for an adman as ambitious as the 43year-old Berlin. Since arriving at DDB in May 1992 after a falling-out at Goodby, Berlin & Silverstein, the high-profile Berlin had garnered steady publicity for DDB–not all of it favorable. A memo he wrote about Bristol-Myers Squibb, comparing its treatment of agencies to the Spanish Inquisition, was leaked to the press. Soon after, the longtime client was gone from DDB’s roster. Although Berlin did keep a restless GTE in-house and picked up new accounts from Johnson & Johnson, he was privately telling friends about his frustrations within the agency bureaucracy. To keep his star rising, he wanted to be at a shop where he could be more entrepreneurial and have hands-on control.
It was a tall order to handle all at once. Two weeks ago it proved too tall, as Shaver and his staff decided, along with Volkswagen dealers, that the VW team led by Berlin and Wright was working effectively–but they wanted them without the rest of DDB Needham. They wanted, and got, a new and smaller agency that would have VW as its biggest client. As a result, DDB would effectively give up its agency of record status after 34 years to Berlin, Wright & Cameron. (The third partner is Ewen Cameron, a planning director Berlin hired at DDB.) The ties to headlines like “Think Small” and “Lemon,” which had been loosening ever since Doyle Dane Bernbach merged with Needham Harper Steers in 1986, were broken. DDB will still own a position in the new agency, but its own brand identity with VW has now been relegated to history.
Critics who said Berlin couldn’t save VW for DDB were proved right. In a turbulent year for automakers and their agencies, the fact of a change wasn’t surprising. The eye-catching part was how it was accomplished, with the task of saving VW shifted smoothly to an untested yet familiar entity. “There are a lot of good things about a big agency that can still be of benefit to Volkswagen, such as DDB’s media capabilities,” says Berlin. “But the way that our team will be able to focus on Volkswagen and a few other clients will clearly be of benefit to both the clients and to us.”
Shaver had arrived at VW’s Auburn Hills, Mich., headquarters in the fall of last year, fresh off an extended tour at GM’s Saturn division, where he ran consumer marketing and took part in a reinvention (for General Motors) of the agency-client relationship. The award-winning work done for Saturn by Hal Riney & Partners had shown that big auto companies could turn to midsize shops outside of Detroit and Los Angeles for their campaigns. According to sources at DDB, Shaver was recruited to VW with the mission of making similar changes, including advertising and most likely the ad agency. Says Shaver, “I wouldn’t single out just the ad agency, but yes, we certainly looked at everything last fall in terms of our relationships.”
Indeed, change was in motion throughout VW. At Volkswagen AG headquarters in Wolfsburg, Germany, Dr. Carl Hahn, who for years had been a champion of DDB, was being replaced as chairman by Ferdinand Piech, who was known to have no special feeling for DDB. VW AG’s no. 3 executive, Daniel Goeudevert, who had been a DDB opponent under Hahn, managed to get media buying reviewed across Europe in Pieoh’s first month on the job. In the U.S., the impetus for change was urgent. VW’s sales have fallen sharply, from 145,000 a year as recently as 1988 to 76,000 last year; 1993 sales are running at about half that level. At Audi, VW’s upmarket division, sales were an anemic 15,000 last year.
DDB executives got a taste of things to come for VW in April, when it was fired off the Audi account. (The account has since been awarded to midsize shop McKinney & Silver in North Carolina.) David Huyett was the marketing director at Audi when DDB was dropped. In July, he replaced Schembri as director of marketing at VW, and he made it clear what he was looking for from Berlin when he arrived on the scene. “At the stage we are at now, we need to be the focus of the top management of our ad agency,” says Huyett. “We just feel like our challenges are bigger than the attention that a big multinational agency can give us. It was much the same situation at Audi.”
Before Audi went into formal review, DDB Worldwide chairman Keith Reinhard had tried to come up with a solution like the one for GTE–a dedicated agency, called Focus GTE, formed within the agency to handle the account. That proposal was rejected by Audi boss Gerhard Klauss, who wanted new blood. With VW, the concept held more promise. Shaver and Huyett were flexible on the structure of the unit. What they wanted was more dedication of time and resources from top management, and they were open-minded about how it would be done.
On July 23, Shaver and Huyett flew to New York to meet with Berlin and Wright. The four, plus Reinhard, had previously discussed setting up a DDB division that would serve VW alone. When they sat down at P.J. Clarke’s over hamburgers, however, the VW executives said there was a problem. VW’s retailer council had rejected a Focus GTE concept and wanted a review. “They wanted DDB gone, and they wanted nothing else,” says one DDB staffer. “We have been pushing for a change in the advertising for some time,” confirms Chris von Berg, a Laurel, Md., dealer who is head of the VW retailer council’s marketing committee. “We’ve been with the same agency for a long, long time. It’s just good business to do it.”
The timing for an uprising over the agency assignment couldn’t have been worse. The creative team had just returned from a month-long shoot of the national ad campaign, filmed all over Europe and Japan and directed by Bob Giraldi. The new spots, which broke last week on both coasts, usher in a new campaign theme, “The Most Loved Cars in the World,” to replace the teutonic Fahrvergnugen. Before Huyett’s arrival, Shaver had bought into the strategy, which included a carefully managed raft of retail ads, some cleverly focused on the retailers themselves in each market. The floor traffic and sales numbers from the early markets were good. But the dealers, many of whom still didn’t have a supply of cars and thus didn’t have advertising, were still calling for their heads.
Neither Shaver nor Huyett wanted a review. The interruption of nine months–four or five for a review, and four or five to get the new agency up to speed–was impossible in the midst of the launch. What’s more, they wanted Berlin and Wright. The question was, says Wright, “Could they have us without DDB? And the answer became ‘sort off”
In the three weeks after their lunch. Berlin set out to visit with each of the six VW dealers that make up the retailers’ council. He pitched the idea of an agency separate from DDB, one that would operate autonomously, that management would own part of, and that would be more than 50% dedicated to VW and its dealers. Four dealers bought into the idea presented by a persuasive Berlin. Two were not convinced, preferring a clean break from DDB, just as Audi had gotten. In the end, on August 12th. the council agreed to go along with it.
“The retailers have a strong point of view,” says Berlin. “They’ve been through a very difficult couple of years and are pushing for change. I’m glad they are going to let us show them that we can be their new ad agency.”
One sure casualty of the break with DDB is DDB Worldwide president John Bernbach. The son of the legendary Bill Bernbach, whose agency was defined during the era of the Beetle and its advertising, John Bernbach ran the account globally for a decade after his father’s death. Through his close friendship with VW chairman Hahn, Bernbach almost single-handledley guided the VW business as it stretched over 25 countries, plus 18 international markets for Audi. He was out of the country when the new agency was announced and remained unavailable last week. In a recent interview, he commented on why he so readily stepped aside: “When there are such changes going on with a company, new management, etc., it makes for a delicate time. And when your client changes, you have to change, too.”
What is it about Berlin and Wright that won over Shaver? “It’s their attitude,” says Shaver. “Volkswagen itself is a brand filled with a special attitude, and they have the attitude that seems to go right along with it.”
That attitude showed up on the account from the time Berlin took it over at the start of this year. The first move he made was to shift the account responsibility from Detroit to New York, where the agency’s best creatives could work on it. DDB’s Detroit office had never been a good idea, or if it was at one time, it was never executed properly. Just as Volkswagen had lost much of its personality when it moved its headquarters from New Jersey to Detroit in the late ’70s, DDB seemed to lose its creative and strategic coordination when it moved its responsibilities to Detroit.
The people at the Detroit office were often defensive about their work, because either the client or someone from the New York office was always trying to get New York more involved. Aware of the turf battles, Berlin flew about a dozen staffers from the Detroit office to New York to be briefed. It would have been cheaper for Berlin to go to Detroit, but there was a point to be made about where the authority resided. He assembled them and, according to one present, said, “You all have individual agendas, and that is OK. You have careers. You have families to take care of. You want to make money. But as each one of you forms your own agenda, call it a string. If those strings don’t come together to form a rope to pull this account together, you will be history. You will be gone.”
The speech was long overdue. DDB had been on the ropes for years with VW and Audi in this country, both with dealers and U.S. staff. And VW management in the U.S. had been unsteady as well. In 1989 American chief Jim Fuller was killed in the Pan Am crash over Lockerbie, and former executive Bill Young was recruited back to Detroit. According to officials then at VW, Young wanted to review the advertising agency assignments for VW and Audi. Young clashed with Hahn over advertising and other issues during his five-year tenure, which came to an end in May.
The campaign that helped smooth over the transition from Fuller to Young was one that Reinhard himself gets credit for–Fahrvegnugen. Desperate for some advertising that would get VW noticed despite a small budget, DDB starlets dug through every piece of research the agency had ever done on VW. They found one aspect of the cars that no other company, not even the Japanese brands, could make: the unique feel of driving a Volkswagen. The word Fahrvergnugen, meaning the pleasure of driving, was found in a technical dictionary. The campaign won over hearts and minds of dealers and some VW executives in 1989. But four years later, it had not been updated or refreshed. It had become as tired as a rusted-out Beetle.
DDB’s Detroit office did come up with a campaign last fall that Shaver approved. It showed beautifully photographed VWs set to the music of an Irish New Age orchestral group called Clannad. Like Fahrvergnugen, the campaign generated a lot of short-term attention. But the ads really didn’t do anything to help the brand, notes Wright: “The Clannad campaign was nice to look at, but it offered nothing to the consumer as justification for paying the premium for a VW instead of a Toyota or a Mazda.”
In February, Berlin, Wright and their creative team traveled to Germany to drive the new cars and discuss marketing strategy with Volkswagen AG executives. The new Golfs and Jettas that would be coming out of VW’s problem-plagued plant in Mexico were the first significant upgrades in nine years. Once the glitches were worked out and the assembly lines went full tilt, dealers would finally have a competitive product to sell. In addition, VW would launch the cars with the most aggressive incentives in the industry: a 10-year/100,000 mile warranty, two years of free maintenance and a lease deal that is under $200 a month. The line had to have the staying power of BMW’s “Ultimate Driving Machine,” a slogan the Germans admired a great deal.
Starfen and Rogers–considered to be perhaps the best creative team in the agency–got the assignment. The two had done a campaign in 1988 in which Volkswagens slalomed around German engineers donning white lab coats. Those ads were well received by the client and dealers but had fallen flat in the marketplace. Itching for another crack at VW, they came back from Germany thinking they had the idea that had eluded them on the ill-fated boat trip. Their new line for VW: “Happy Driving.”
Berlin hit the ceiling. “If you guys think I’m walking down the hall to tell Keith Reinhard that his Fahrvergnugen line is being dumped for ‘Happy Driving,’ you’re out of your bloody minds,” he bellowed. “Andy pummeled us,” recalls Staffen.
So it was back to work on a new line. Unlike many agency bosses in the position of saving a major account, Berlin did not throw a legion of creative teams at the problem, but kept Rogers and Staffen at it. A few days and nights later, they told Berlin they had it. The two had picked up on an oft-mentioned frustration expressed by the client. While Volkswagen had become weak in the U.S. and had lost the confidence of many consumers, how could the company get across the message that VW is solid, and, in fact, is Europe’s No. 1 auto producer? Set to images of people in Europe and Japan “loving” their Volkswagens, the tagline they went back to Berlin with, and ultimately sold through to Shaver and Piech, was “The Most Loved Cars in the World.”
Whether “The Most Loved . . . ” campaign and a newly-formed agency can save VW remains to be seen. Berlin is confident thatVW can return to sales of more than 150,000 cars a year in the U.S.–a boast in keeping with his character, and one that puts the pressure squarely on his new agency to deliver. And when VW executives and dealers call for scalps, which they inevitably do, it won’t be DDB Needham, which had become big and institutional, they’ll be asking for. It will be the first name on the door of their new agency: Berlin.
Copyright Adweek L.P. (1993)