What Drove BMW, GSD&M Apart

The recent leak to the media about GSD&M Idea City’s plan to resign BMW may have been a preemptive strike to gain a PR advantage over a newly installed client executive who, as it turns out, was considering his own split with the Austin, Texas, agency.

Last month, the Omnicom shop said it has opted not to renew its contracts with BMW North America and its German parent when they expire at the end of the year. In September, BMW named a new North American marketing head, Dan Creed, who had been vp, aftersales at the company. He succeeded Jack Pitney, the carmaker’s vp, marketing, N.A., who was killed in a tractor accident while vacationing on his farm the previous month.

When asked if BMW’s new regime planned to re-up with GSD&M, Stacy Morris, the marketing communications manager for BMW N.A., said: “We had been discussing change.”

Still, that doesn’t translate into an agency review. At least, not yet. “Currently, we have no plans to bring on a new agency,” Morris said.

In the U.S. the German automaker has worked for the last five years with Kirshenbaum Bond Senecal + Partners’ Dotglu unit, which is BMW’s digital agency of record in North America; MDC Partners’ KBS+P has also done occasional project work for the carmaker. In addition, BMW works with WPP’s Grey West unit, which was awarded regional ad business in 2008. “We will continue to work with this team of agencies now and in the future,” said Morris.

John McGrath, svp, communications at GSD&M, declined to comment on BMW.

The client spends $100 million-plus annually in U.S. media alone, per Nielsen. Though the first two-thirds of 2010, the nameplate spent close to $90 million on ads.

BMW has a committee known as the International Power House (IPH), before which BMW shops around the world can compete to become the lead agency on a global campaign. Last year, GSD&M developed the “Story of Joy” and was given the lead in implementing it. (With GSD&M’s departure from BMW’s agency roster, there are currently no other American shops competing at the IPH level.) The IPH meets about five times a year.

Martina Daschinger, a BMW representative at the company’s Munich, Germany, headquarters, said there are no current plans to drop the “Joy” strategy. “In the near future there will be no activities regarding the development of a new global strategy,” she said. “The ‘Story of Joy’ is still our global brand campaign and will be developed further.”

Product marketing is handled separately from the global image work. “For the product-related BMW brand communication we continuously worked and still work in the competitive mode of the International Powerhouse process and have a very efficient agency network,” Daschinger noted.

While GSD&M may not have known BMW North America was having its own doubts about maintaining the partnership the agency had been considering its future with the automaker. Two of the biggest frustrations: Difficulty in making money off the business and dealing with the international politics within BMW’s marketing ranks, per sources.

The relationship was changing even as BMW was appointed creative lead in May, 2009. Just a couple of weeks before GSD&M assumed that role, it lost its media responsibilities for the client to Interpublic’s Universal McCann. In the end, working on the prestige auto brand had become anything but the “Story of Joy.”