American Honda keeps RPA as creative agency for Honda; Mullen picked for Acura
MediaVest named media agency for 2 brands
Honda Motor Co. spent $850 million on measured media in the U.S. for the Honda and Acura brands in 2012, up from just over $700 million in 2011.
Editor's note: An earlier version of this story incorrectly identified the advertising agency that launched Acura.
LOS ANGELES -- American Honda picked incumbent RPA to remain its advertising agency of record for the Honda brand after a three-month review while giving Acura's creative business to Boston-based Mullen.
The decision announced Monday changes a 26-year relationship between RPA and Honda. RPA has carried the Honda brand since the agency was formed in 1986. It landed the account for Honda's luxury Acura brand in 1999.
MediaVest of New York has won the media-buying account for both brands from RPA, which used to be known as Rubin Postaer and Associates.
As a result, Honda's advertising and marketing relationship moves to more of a hub-and-spoke model with different suppliers for media buying, and for the Honda, Acura, Hispanic and African-American campaigns.
The four finalists for the $850 million account were RPA; Mullen; 72andSunny, of Los Angeles; and The Martin Agency of Richmond, Va. The media-buying challengers were PHD Worldwide of London; and Horizon Media of New York.
The Honda brand represents about 70 percent of American Honda's overall marketing outlays, according to 2011 figures from Advertising Age, a sister publication to Automotive News.
"We are confident that our new team of agencies will create dynamic marketing campaigns that connect and engage consumers with our products and our brands, while achieving an even higher level of efficiency and effectiveness," said Mike Accavitti, American Honda's chief marketing officer.
MediaVest's role as a separate media agency is expected to result in more sophisticated targeting of American Honda's media mix, with a significant improvement in media buying efficiency, the company said.
"Getting smarter about how we communicate was a critical goal of this process and even with the same level of investment we expect to realize more efficient and targeted media plans, which will increase the amount of money we spend on reaching our customers," Accavitti said in a statement.
Honda is in a strong position, product-wise, with recent changes to its three top volume nameplates: redesigns of the entire Accord lineup and CR-V crossover occurred last year, as did a 2013 freshening of the Civic compact.
But this also means the Honda brand is entering a fallow period with few major product launches; the agency will have to work to keep retail interest churning.
A strong December helped American Honda's full-year 2012 sales rise by 24 percent to 1.42 million vehicles -- with the caveat that most of summer 2011 sales were impacted by the Japanese earthquake and tsunami. U.S. sales through February are up 4 percent.
Honda has grander volume aspirations. The Honda and Acura brands are aiming at their combined 2007 sales record of 1.55 million sales for this year. And Honda Motor CEO Takanobu Ito also has said he wants American Honda to reach 2 million sales in the near term. That is part of Honda's global growth strategy of moving from 4 million to 6 million sales by the 2017 fiscal year.
"This is a really good chance for our business," Honda Motor CEO Takanobu Ito said at a roundtable at the Detroit auto show in January. "We have a lot of momentum. We are at full production for the U.S. market."
Although the 2012 Civic was a flop among automotive journalists, it was a sales smash with dealers as Honda pushed lease deals. Even though Consumer Reports removed the Civic from its "recommended" list, the Civic outsold the Toyota Corolla for the first time in recent memory.
But pushing incentives is a rare occurrence for the Honda brand; the 2013 Civic has no deals, and consumers and salesmen will have to return to the old ways.
Honda's next growth spurt should happen in 2014, when a redesigned Fit and a new Fit-based crossover will arrive.
They will be produced at Honda's new Celaya, Mexico, plant. That plant will have a capacity of 200,000 units, which will be split between the U.S., Mexican and Canadian markets.
On the Acura side, the flagship RLX sedan is just reaching market, and RPA will still be in charge of that launch, Accavitti said in a January interview.
However, the MDX crossover -- which is Acura's volume leader -- arrives this summer, and that launch will be part of the transition between RPA and Mullen, Accavitti said.
Honda chose Pittsburgh-based Ketchum Advertising to launch Acura in 1986. Ketchum lost the Acura account to Suissa Miller in 1996, and then it went to RPA in 1999.
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