Nissan spending $200 million for a little respect.

New ad campaign aimed at shedding its old image

CARSON - "We stand for something," proclaims Nissan North America. And to make sure consumers don't forget, the U.S. sales arm of the Japanese automaker is spending a cool $200 million to drive home its new slogan.

The aim of the ad campaign, launched at the beginning of the month, is to enhance Nissan's brand identity. The campaign's $200 million budget equals two-thirds of Nissan's annual U.S. advertising budget.

The first commercial, a nearly epic two-minute spot, debuted during the closing ceremonies of the Olympics on Aug. 4. It features the "Dream Garage," an enormous room filled with Nissan/Datsun models that date back to as early as 1937.

The garage is tended by Mr. K, a "mythical" Japanese man who speaks only in superlatives and wears a baseball cap with the old Datsun logo. Mr. K is a reference to Yutaka Katayama, who was president of Nissan Motor Corp. from 1965 to 1975.

Company officials did not disclose how much the kick-off commercial cost to produce, but Nissan spent at least $2 million to purchase the air time, according to estimates from the advertising industry. The campaign was created by TBWA Chiat/Day North America in Venice.

"We are doing this because we would like to become the import brand of choice," said Larry Caudill, Nissan's senior manager of marketing and communications.

Caudill acknowledged that the company has been handicapped by its name change in the United States from Datsun in 1983. "We could have done a better job carrying over our heritage," he said.

While it was once the best-selling Japanese auto brand in the United States, Nissan has since been overtaken by Honda and Toyota.

Unlike those two competitors, Nissan has had limited success luring repeat buyers and linking its brand to an enduring message, industry observers said.

Honda and Toyota regularly make the influential customer satisfaction study issued annually by survey firm J.D. Power & Associates of Agoura Hills, while Nissan is often left out.

Through July, Nissan's year-to-date sales are down 3.9 percent, with 398,631 vehicles sold, compared to 410,076 a year ago. By contrast, Honda and Toyota's sales are up 11.9 percent and 8.8 percent, respectively.

"If you ask consumers for a one-word description of Toyota, they would say 'quality' or 'reliability.' A one-word description of Mazda, and they would often say 'sports.' But when you ask for a one-word description of Nissan, people are often stumped," said Steve Kosowski, international product manager for AutoPacific Group Inc., a Santa Ana-based consulting firm.

Added Dave Kalmus of The Dohring Co., a Glendale-based market research firm: "There's no kind of buyer loyalty to Nissan as there is with other makes. People are in and out with that brand. It's not been a family of cars."

Along with the initial "Dream Garage" spot, Nissan has slated a series of commercials that will spotlight current models, but still emphasize the brand name. The spots are scheduled to run for 49 weeks, with most airing during prime time and in connection with major sporting events, said Caudill.

While observers called the strategy risky, they added that it is also overdue.

"I have to give kudos to Nissan. It's a gutsy move on their part," said Bradley Johnson, Los Angeles bureau chief for Advertising Age magazine. "It certainly is a lot easier to do the same old thing in car advertising."

If the campaign works, Nissan would be able to increase its sales volume and its number of repeat customers, as well as perhaps boost the resale value of its cars, Johnson added.

But consumers could also be confused by the initial ads because they are a departure from typical advertising methods, according to Kosowski.

"While the imagery is very pretty, and some of the concepts and images are very flattering on the screen, there could be a lot of ambiguity in the consumers' mind as to who is behind this," he said.