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June, 2024

Saatchis swoops Dentsu for Toyota retail business – set to deploy AI from US Saatchi unit in 12 months

What you need to know: 

  • Publicis Groupe adds retail duties to the bulk of the Toyota media and creative business landed three years ago.
  • Dentsu Creative is out.
  • Insiders suggest a US-developed AI-powered automated content play across video, images and text helped swing the pitch in Publicis’ favour, with the carmaker’s 275 dealerships requiring volume messaging tailored to local markets.
  • After a rocky start to 2023 with volumes impacted by supply chain issues, Toyota ended the year strongly – and in 2024 could set a new sales record. 

Publicis Groupe has taken Dentsu Creative’s last-remaining piece the Toyota Australia business following a three-way pitch with the incumbent and McCann-aligned Hero for the automaker’s retail and value chain communication portfolio.

The account – understood to be worth around $4.5 million in annual revenue – will be led by Saatchi & Saatchi via the Publicis Power of One model, adding to the group’s sweeping remit across the Toyota and Lexus brands. The holdco now has Toyota’s creative, brand, media, retail and CX remits.

Mi3 understands the pitch came down to Publicis’ proposition of bringing Toyota dealers into a one-stop marketing services group across core disciplines and an AI play that would leverage tech and learning from the United States – where Saatchi & Saatchi and its stablemates have long had near complete coverage of the Toyota and Lexus advertising business. Mi3 understands however that it is not a plug and play AI model. 

“Toyota has been a valued partner for over 40 years and we are honoured to have this opportunity to build upon our enduring relationship. In bringing together our expertise in marketing transformation and Toyota’s focus on innovation, we’re excited to extend the power of our connected capabilities across creative, content and data to drive Toyota’s Retail and Value Chain business,” said Publicis Groupe ANZ chief, Michael Rebelo.

According to insiders, the AI-driven solution will sit within Publicis Groupe’s global AI platform, Marcel, and use automation to create workhorse-style retail executions across video, image and copy. The appeal is clear, given the historically resource-heavy, high-volume, yet often formulaic creative outputs that come with the territory.

“This decision has been made following an extensive, standard agency review process, which aims to support Toyota Australia’s future marketing priorities,” a Toyota Australia spokesperson told Mi3. “We look forward to developing innovative customer-focused solutions in the Value Chain and Retail space.”

The carmaker also nodded to the incumbent for its efforts over the last decade.

“We would like to take the opportunity to sincerely thank Dentsu Creative for their dedicated support and contribution to Toyota over the years,” said the spokesperson.

The win tightens Publicis’ grip on Toyota’s Australian business three years after it emerged as the big winner in a sweeping review of Toyota Australia’s digital, media and creative strategy and supply chain.

The 14-month long pitch process cemented Saatchi & Saatchi as lead creative agency (a partnership that pre-dates the 1990s), while shifting the bulk of its circa $100 million media account into Spark Foundry – a move that finally ended the automaker’s long relationship with indie agency The Media Store, set up to service the business in 1997.

The following year Toyota took cue from its dealing with Publicis in the US and rolled in creative and media for sister brand Lexus as well. At last count, that leaves a few select product portfolios that sit with Hero.

Meanwhile, it marks the end to a decade-long partnership between Dentsu and Toyota in the Australian market. The Japanese holdco, which declined request for comment, got its hands on Toyota’s retail business in 2014, by virtue of its acquisition of Sydney-based independent creative firm Oddfellows (which was merged into BWM two years later).

While Dentsu was at one point a mainstay on Toyota’s creative roster across several product portfolios, by 2021 it was solely handling the retail account. The impact of the exit will be felt at the agency’s Melbourne office, though Kmart, Vicinity, L’Oreal, DBG, and MYOB are understood to remain as core clients.

Though the loss is unlikely to come as a shock, given Publicis’ ongoing incursions, it’s not the most auspicious start for Dentsu’s new model, debuted in April. The new consulting-style matrix of capabilities was preceded by a slew of redundancies.

Toyota meanwhile has returned to form. A soft start to 2023 due to supply chain issues was followed by a stronger second half with Australia’s top-selling carmaker selling north of 215,000 vehicles for the calendar year (back 6.8 per cent on 2022). As of 30 May 2024, Toyota has sold 100,398 vehicles, up 41 per cent on the same period last year. At that run rate it could nudge a record first half and a 240,000 unit year.

Ford, with 40,129 units sold year to date, has worked to consolidate second place – ending 2023 up 31.8 per cent year on year – but the gap remains vast. Mazda is back 4.1 per cent for the year so far, Kia is up 4.6 per cent while stablemate Hyundai in fifth is line-ball per SMI industry sales data.