Levi Strauss Changes Agencies
Levi Strauss & Co. on Monday ended a 67-year relationship with Foote, Cone & Belding by awarding advertising for its flagship Levi brand to Venice-based TBWA Chiat/Day.
The transfer of the $80-million account, which represents another high-profile client for Chiat/Day, underscores the severity of a market share slide that is forcing Levi to close 11 plants and eliminate more than 6,000 jobs.
The decision by the 148-year-old maker of bluejeans to drop an agency that helped make its brand known around the world also illustrates how bottom-line considerations rather than historical relationships rule the advertising world.
Over the last year or so, Delta Air Lines, United Airlines and Mazda North America have ended long relationships with their agencies.
The decision to switch “was a difficult decision because Foote Cone was a very important component of the success we enjoyed over the years,” said Levi USA President Tom Fanoe. “But it just made sense to look outside of what we were doing, to other options in terms of marketing partners.”
TBWA Chiat/Day President and Chief Executive Bob Kuperman said his firm is charged with energizing a brand that has long been a cultural icon around the world.
“There’s a truth in every generation that’s been involved with Levi,” Kuperman said. “And we’ll have to find that truth and deal with it in today’s generation.”
Kuperman said it’s too early to say how many TBWA Chiat/Day employees will work on the account, which will be handled from offices in Los Angeles and San Francisco. Fanoe said the new agency’s initial ads will debut before summer.
Chiat/Day’s challenge will be to reestablish links to younger consumers, many of whom now look to other brands for fashionable apparel. At the same time, Levi’s advertising can’t risk alienating adults, who generate about 75% of Levi’s $7.1 billion in revenue in the United States.
“They’re going to have to make Levi exciting and relevant again to kids,” said one ad industry executive who followed Levi’s closely watched agency review. “But they’ve also got to target 45-year-old guys. And that will be tough because kids aren’t going to wear what dad’s wearing.”
Fanoe acknowledged that Levi hasn’t been capturing the hearts and wallets of many younger shoppers. “For many years, the Levi brand was the uniform of younger people,” Fanoe said. “And we were also able to nurture a relationship with people 25 years of age and older. In the last few years, that’s been more problematic for us.”
Chicago-based Foote Cone, which continues to handle Levi Strauss’ Dockers and Slates brands, is disappointed it won’t continue with Levi, said Jack Boland, the San Francisco-based agency’s general manager.
Boland said the more than 20 people associated with the Levi account won’t face layoffs, because Foote Cone has added $300 million in new accounts in recent months.
Asked whether Foote Cone is a victim of Levi’s business woes, Boland said: “I wouldn’t suggest that. I think they felt a need to evaluate all of their relationships and we fell into the bucket.”
Some ad agency executives question whether TBWA Chiat/Day, which recently added Taco Bell and Apple Computer to its fold, has the creative strength needed to carry another huge client that needs to quickly build market share.
“They promised [creative director] Lee Clow to Taco Bell when it was the new client and to Apple when it was the new client,” one agency executive said. “They’re on a tremendous creative roll, but at some point you have to wonder if the work can stay great.”
Other agencies that took part in the Levi review: BBDO Worldwide; Hal Riney & Partners; and Bartle Bogle Hegarty, a London-based agency that handles Levi’s advertising in Asia and Europe.
Times staff writer Denise Gelline contributed to this report.
