VW Troubled By NBC Uni Deal

Anthony Fontanelle
July 19, 2007

Volkswagen AG's new Touareg 2 might snatch the limelight near the end of “The Bourne Ultimatum,” the Universal Pictures' upcoming film. In the movie, the Touareg is involved in a nerve-racking major chase scene where it flaunted its enviable performance.

As for “Bourne,” VW is basing the introduction of its updated Touareg 2 model on the film, with a multimillion-dollar campaign including TV, print and online ads. This is to bolster enhanced Volkswagen Touareg parts incorporated in the redesigned sport utility.

But the automaker’s executives are dismayed with the overall marketing partnership that the company entered with NBC Universal in May 2005. The “Bourne,” which will be shown August 3, is the eleventh movie placement for VW. But according to company sources, the film is only the second that has met the German automaker’s expectations. The other film, “Knocked Up,” a comedy set to arrive in theaters June 1, also is commended by VW.

Sources said that all the other placements VW has had in Universal films have not been sufficiently memorable or significant. “The placements we've had so far are not up to the standard we had expected when getting into this deal,” said Martin Biswurm, the international entertainment marketing manager at Volkswagen.

Meanwhile, Universal said that it is “proud” to have “successfully placed” 21 VW-brand vehicles in 17 Universal, Focus and Rogue films totaling $990 million in global box-office in the first two years of the companies' alliance. “VW has been integrated into 56 Universal premieres and events and has had a brand presence on nearly 40 million Universal, Focus and Rogue DVDs globally,” the film outfit said in a statement. “Universal has facilitated many successful collaborations between VW and filmmakers, resulting most recently in significant integration into 'The Bourne Ultimatum.'“

“In the first two years of the relationship, VW has leveraged 'King Kong' and 'The Bourne Ultimatum' to create significant global marketing campaigns. An average of one global campaign a year, especially at the beginning of such a large alliance, is, in our opinion, a fantastic track record,” was added to the statement.

VW expects to spend roughly $40 million over the three-year deal. But sources said that the automaker has the option to extend the term for two years. Biswurm said that VW has not decided whether it will exercise its option to extend the contract for a full five years. “That decision hasn't been made yet,” he said. “I think the problem is a systemic studio weakness, and Universal has done a number of things recently to address those weaknesses.”

“Some of the films discussed in the second year of the contract are still being produced, and Year 3 is still ahead of us, so we really only have the first contract year to make our judgments on at the moment,” Biswurm added.

Despite the fact that the automaker is dismayed with the results of the deal, VW at least believes it did not overpay for what it has received so far from the pact. Universal declined to give terms of the alliance. “What we've spent so far is commensurate with what we've received and what we expect to receive based on films in the pipeline,” Biswurm said. “Until recently, the placements have been marginal. That weakness is a cause for our disappointment.”

Other Universal films in which VW autos have starred so far are “Curious George,” “The Fast and Furious: Tokyo Drift,” “Inside Man,” “Hot Fuzz,” “Accepted,” “Something New,” and “Mr. Bean's Holiday.” At present, VW expects to have placements in five additional films in production, but it is not committed to spend promotional dollars against any of them, sources noted.

Source:  Amazines.com