By Max Bernhard
Volkswagen AG namesake passenger car brand plans to cut its advertising network from about 40 agencies to three lead agencies, including WPP, Omnicom Group and Cheil Worldwide, as part of efforts to boost marketing efficiency.
WPP will be responsible for North America, while Omnicom will cover Europe and South America and Cheil will continue its work for the marque in China, the VW brand said Monday.
The brand said it will pool its marketing activities for those regions in four new locations in Berlin, New York, São Paulo and Beijing. Marketing will be managed in a "leaner, more centralized way," said Jurgen Stackmann, the brand's sales chief.
The move is part of a plan to improve marketing efficiency at the brand by about 30% by 2020, while keeping the media budget stable at 1.5 billion euros. As part of the strategy, the VW brand aims to grow its digital-media share to close to 50% by 2020 compared with about 25% in 2015, it said.
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