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Advertising at General Motors Corp. took a bumpy ride last year as the auto king -- the first marketer to ever crack $3 billion in U.S. spending -- slumped 4.8% to $2.94 billion in ad expenditures, according to Advertising Age's 44th annual 100 Leading National Advertisers report.

Even as others in the elite tier of the Top 100 retrenched, the group expanded its ad spending by 6.9% to $64.6 billion. Leading the charge were 100 Leading National Advertisers in the treasure-chest ad categories of prescription drugs, telecommunications, and entertainment and media.

Substantial though it was, aggregate growth came short of last year's 8.6% advance for the Top 100, yet it more than sustained a healthy media and advertising climate that has abetted the nation's economic boom.


GM's ad power -- $3.09 billion in '97 -- never got fully untracked in '98 after it slashed media during a six-week strike that shut down auto production in early summer. Only Oldsmobile among GM's megabrands grew in media for the year. GM's share of car and light-truck sales was not impressive, dropping 1.9 points to 29.2% of market, according to Ad Age sister publication Automotive News.

The next three leaders in the Ad Age ranking -- Procter & Gamble Co., Philip Morris Cos. and DaimlerChrysler, respectively -- may have been in a position to threaten GM's ad leadership, but detoured, paring their advertising as well.

The Top 100 are ranked by the sum of their expenditures in U.S. media measured by monitoring services -- 55.4% of the Top 100 ad dollars -- and by their unmeasured forms of advertising (sales promotion, direct response, etc.) estimated by Ad Age.

The Top 100, spanning from GM to DreamWorks SKG at $223.2 million, are media power brokers. They supported 478 megabrands with $10 million or more in media in '98. Each year the Top 100 consistently accounts for nearly 40% of the nation's media; 30% of all ad forms.

Given such fulcrum-like status, there's little doubt the Top 100 has led the strong first-half surge in media in '99 -- up 6.9% for all advertisers over the comparable period in '98. Media engines driving this train are network TV, up 9.2%, cable TV, up 26.8%, and magazines, up 10.2%, says Competitive Media Reporting.


As an ad medium, the Internet advanced 80.1% in first quarter '99 to $345.4 million, reports the InterWatch report of InterMedia Advertising Solutions. Advertising online may lack the volume of traditional media, but advertising offline of Internet-related brands, particularly of computers, brokerages and retailers, is driving growth in traditional channels.

Proliferating online brokerage businesses this year should spend $525 million in offline advertising, up 91% from '98. Research shows 16 million new investors poised to e-trade (see story on Page S-22).

Ford Motor Co.'s shift of millions of ad dollars into new media reflects automaker awareness of customer buying habits. Some 40% of auto buyers in 1998 scouted online for their vehicles, a number to hit 65% by 2000 (see story on Page S-12).

It's become apparent that online apparel sales are making a difference -- they're already tapping $100 million for leading online retailers, The Gap and Lands' End included.

There's a warning held within those figures. Only 6% of online sales are from new customers to a particular chain. With buying online flourishing, walk-in shoppers will get picked off by Internet-only marketers if retailers are slow to integrate curbside and online operations (see story on Page S-18).


Sheer ad power is vested in marketing prescription drugs directly to consumers, which, along with long-distance telecommunications companies, appear consigned to pour ever-increasing sums into the ad troughs. The telcoms binged on 10-10 numbers in '98, dialing up $281.4 million in media dollars, or 25% of total media spending by these companies. That percentage had grown to 39% by mid-year '99, but in the blink of an eye the 10-10 plans have become casualties of the more trendy telcom panacea -- nickel or seven-cent fares (see story on Page S-18).

As for GM in '99, its ad spending is on the rebound. The automaker spent $1.39 billion, up 28.6% in the first-half from the comparable period in 1998 when the labor dispute had yet to take its toll. Vehicle sales have bounced back 1.2%, but share is stuck at 29.8%. A sub-30 share for GM is unheard of in the annals

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