A change-minded Mazda North American Operations in Irvine has put its $150 million yearly advertising account up for grabs in what could be a blow to the automaker’s current agency in Newport Beach.
The Newport Beach office of Southfield, Mich.-based Doner Co. has handled the U.S. arm of Japan’s Mazda Motor Corp. for nearly 13 years. The agency, one of the largest operating in the county, opened its office here to service Mazda.
Doner has created commercials for Mazda and bought airtime and other ad space for the automaker.
Now Mazda is readying to reach out to other agencies for bids on its account. The automaker last week confirmed industry rumors that it’s shopping around.
The automaker hired Boston-based firm Pile and Co. to handle a review of its ad business now handled by Doner.
“Doner is absolutely invited to defend the account if it wishes,” said Jeremy Barnes, director of communications and national events at Mazda.
A Doner spokeswoman said the agency intends to “vigorously fight for our business” and that it believes “our best work is in front of us.”
Doner is known for its “Zoom, Zoom” line used in much of Mazda’s commercials and print ads. The phrase became a bit of pop culture in the past decade.
Mazda spent close to $155 million on U.S. ads last year, up from $140 million in 2008, according to market tracker Nielsen Co. of the Netherlands.
The loss of Mazda would be a blow to Doner, which, like other agencies, has been weathering a steep industry downturn.
Doner’s Newport Beach office had $303 million in 2009 capitalized billing—a measure of revenue for ad agencies—according to the Business Journal’s upcoming list.
The agency’s billings were down 8% from a year earlier.
Doner has 82 local workers, down 19% from a year earlier.
The Newport Beach office long has counted Mazda as its largest account. It works with some others, including Lake Forest-based fast food chain Del Taco LLC, Minneapolis-based health insurer UnitedHealth Group Inc. and Newport Beach-based Hawaiian fusion restaurant chain Roy’s, part of Florida-based OSI Restaurant Partners LLC.
This is the first time Mazda has put its advertising account up for review since teaming with Doner in 1997.
“We go through and review our business operations on a regular basis,” Mazda’s Barnes said. “This is the latest in our efforts to ensure we get the highest quality at the most competitive price.”
Industry sources said they believe the review was prompted by changes at Doner in the past year, including the departure of an executive who had worked on the “Zoom, Zoom” campaign.
John DeCerchio, Doner’s former chief controlling officer who got his start in creative work with Mazda, left last year and sued the agency over his severance package.
Doner also underwent an ownership shift late last year with Chief Executive Alan Kalter selling his stake to three other senior executives: David DeMuth, Rob Strasberg and Tim Blett, who runs the Newport Beach office.
Mazda said it intends to keep Doner’s “Zoom, Zoom” tagline regardless of whether the agency retains the account.
“It’s literally ingrained into the fabric of the company,” Barnes said.
Tough Year
Like other automakers, Mazda had a tough 2009 but is starting to see things stabilize. It reported U.S. February sales of 17,054 vehicles, up 4% from a year earlier.
The company expects 2010 sales to be on par or slightly better than overall U.S. sales with the help of its Mazda2 small car.
Doner is working on the launch campaign for the Mazda2, expected this summer. The campaign should start sometime in late July, according to Mazda.
Another automaker, Cypress-based Mitsubishi Motors North America Inc., part of Japan’s Mitsubishi Motors Corp., also has put its ad account up for grabs.
The smaller automaker, which spends about $100 million on yearly advertising, put its account up for grabs in January after parting ways with Hollywood-based agency Traffic.
The local advertising industry has changed dramatically in the past few years as major auto accounts have shifted out of the area.
Land Rover North America was the last big account to shift work, moving it out of the Irvine office of New York-based Young and Rubicam Brands Inc., part of London’s WPP Group PLC.
The $110 million account ended up at Y&R’s New York office after Ford Motor Co. sold Land Rover and sister company Jaguar to India’s Tata Motors Ltd.
Brea-based Dentsu Next Inc. shuttered last year after it couldn’t recover from losing one of its automotive accounts. The ad shop lost the $100 million Brea-based American Suzuki Motor Corp. business.
