Nissan's market share in Japan continues to slip even as Carlos Ghosn and his Renault management team strive to re-build the firm's fortunes. Nissan's, once Japan's leading carmaker, saw its share of domestic auto sales drop further to a first-half low this year at 19.4%.
As part of the Renault-inspired restructuring, this September, Nissan's four dealer chains in Japan are to merge into one and will be re-launched via Dentsu.

The choice of Dentsu surprised many. Dentsu used to handle about a third of Nissan's advertising but was sacked early in 1992 when Nissan announced it would consolidate virtually all its budget with Hakuhodo and anointed them as 'strategic and creative partner.'
While some Hakuhodo executives downplay Dentsu's new role as an assignment "without and strategic significance," Dentsu are more positive. "I think it is of some importance to us that Nissan will no longer adhere to their previous policy of concentrating their marketing partners in one agency," commented one cautious executive.

The Dentsu assignment could be worth as much as £100 million over the next three years on top of Nissan's current annual media spend of about £275 million.

The Dentsu appointment is also disappointment for both TBWA and Publicis.

When TBWA bought Nissan's agency subsidiary Nippo Advertising last year, the sale agreement obliged Nissan to spend 25% of its budget through the agency four years from last September. Nippo's assignments have traditionally been for below-the-line and promotional support. A high profile advertising assignment would have fitted well with TBWA's plans to position the agency as one of the most creative in Japan. According to one of Nissan's advertising manager's, TBWA Nippo does not fulfil a strategic role in their advertising plans but simply places media to fulfill a contractual obligation..

Publicis, meanwhile, who opened a tiny agency in Tokyo last year have been eagerly seeking ways to build up enough critical mass to be able to take substantial assignments in Japan from their three major aligned clients in Japan; Nestle, L'Oreal, and Renault.
Publicis' overtures to form a joint venture with Hakuhodo were rebuffed earlier this year. Joint venture talks with Tokyu Agency, Japan's number four shop, have bogged down in arguments about equity shares and management control. A quest for acquisitions in Japan has so far failed to unearth a candidate strong enough to meet Publicis' needs. The Dentsu appointment puts a Renault-led assignment from Nissan further out of reach.

Like Hakuhodo, Dentsu handles a large portfolio of automobile account, suggesting that even when times are as tough as they are for Nissan, account conflict is still not viewed as a major problem among leading Japanese advertisers. Last year, the top three spenders were Toyota, Honda, and Nissan all of whom now use both Dentsu and Hakuhodo.

While Dentsu are please with their re-appointment, they are cautious about where it may lead. "I'm not sure that Narita-san [Dentsu's president] will add a Nissan to his company cars just yet," said one insider. Yutaka Narita, Dentsu's president, currently can be seen chauffeured around Tokyo in either a Toyota or a Mercedes.