Land Rover North America Inc. is reviewing its $30 million account, a move that reflects the desire by the British marketer's German parent, BMW AG, to make the global operations of Rover Group profitable.
After taking a hands-off approach to troubled Rover since acquiring it in 1994, BMW started making bold moves last year, including sales goals for the United States, according to James Selwa, who joined Land Rover North America in August as vice president of marketing.
Rover missed its 1999 U.S. sales target of 30,000 units by 620 vehicles, Selwa said. And the target is increasing; by the end of 2005, the goal is to sell 100,000 units annually in the United States, he said.
'BMW's influence (at Land Rover) changed the whole nature of our relationship,' said Roy Grace, chairman of incumbent agency Grace & Rothschild of New York. 'We no longer had a true partnership, and the account virtually became unprofitable for us.'
The shop will not defend the account when a closed review starts soon under consultant Richard Roth & Associates of New York.
'Relationships have a lot to do with accounts,' Grace said. 'We never had a great relationship with the new people.'
Selwa said he was surprised the agency declined to participate. He added that no contenders had been identified or invited yet, and said he expects about eight shops to be possible contenders. The review will take up to 10 weeks.
He admitted the tricky part for the new agency will be to expand the brand's appeal to more buyers while keeping its exclusivity. Land Rover will launch a U.S. version of the Freelander small sport-utility, which has been on sale in Europe since May 1998, in 2001.
Land Rover consolidated its U.S. media buying and planning at DeWitt Media of New York, in August without a review. DeWitt already had handled the media accounts for BMW cars and motorcycles.
BMW also hasn't spared Rover in Europe, where the brand suffered from aging small-car models and quality problems.
Last summer, BMW moved staff and decision making on global advertising from Rover's base in the United Kingdom to its own headquarters in Munich.
Longtime Rover agency Lowe Lintas & Partners Worldwide of London lost the United Kingdom account to M&C Saatchi in September. In August, WCRS of London won a review for the $30 million launch of Rover's new 25 supermini and 45 small cars.