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GM DIVISION RE-EVALUATING DEALER AGENCIES BY REGION;14 SHOPS MAY BE REPITCHING TO KEEP STATUS AT PONTIAC-GMC

By Published on .

General Motors Corp.'s combined Pontiac-GMC division is studying changes to its regional advertising that will impact the 14 select shops now handling the two brands' dealer groups.

Each of the division's brand managers will now have authority over how ad dollars are spent on their brands regionally, said a dealer who attended a meeting in October to brief dealer councils. That fits in with GM's role for brand managers, who are responsible for profitability per vehicle.

Such changes could set a pattern for other GM divisions as the automaker switches to brand management.

WORK AWARDED BY REGION

The division, combined in February, now has 11 select Pontiac dealer-group agencies and three shops for GMC dealer groups. Pontiac-GMC may ask the 14 shops to repitch and award work by region, according to the dealer and an executive of one of the select shops.

The system today allows a select agency in one region to handle dealer groups in others.

The division wants to make the changes quickly. Dealer councils will consider the proposals this month.

Roy Roberts, Pontiac-GMC general manager, plans to tell dealers about the changes this month or in early December. Pontiac-GMC said it wouldn't discuss future plans.

CONSISTENT BRAND MESSAGES

Having one agency per region would translate to consistent brand messages, something Ronald Zarrella, VP-group executive, sales service and marketing for GM's North American Operations, is demanding. It would also trim ad production costs.

The dealer who attended the dealer-council meeting said more than 100 different ads were produced by regional dealer shops for the Pontiac Grand Am during the 1996 model year.

The two national agencies for the division also handle regional dealer groups, and it's not a given that Pontiac's national agency-D'Arcy Masius Benton & Bowles, Bloomfield Hills, Mich.-or GMC's-McCann-Erickson Worldwide, Troy-would win accounts in the agency-per-region switch.

Pontiac dealer groups spent $68 million in 1995, vs. $120 million spent by Pontiac, according to Competitive Media Reporting. GMC dealer groups spent $65 million in 1995 vs. GMC's $51 million in national advertising.

The division is considering matching regional dealer-group spending dollar for dollar, so spending could rise considerably, the select shop executive said.

BMW PARING ROSTER TO 4

The plan is similar to BMW of North America's. The importer is now conducting a review of its 14 dealer group shops to offer a more consistent brand message. BMW will pare the roster to four shops-one for each region-for its dealer group business.

Chrysler Corp. moved its dealer group advertising to its national agencies in the early 1990s, which sparked a lawsuit that claimed Chrysler and Bozell Worldwide violated antitrust laws and allegedly tried to eliminate all the shops that handled dealer groups. The automaker recently lost that suit.

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