GM WILL STANDARDIZE ASSESSMENT OF AD WORK;EFFORT TO IMPROVE 'DIALOGUE' MAY ALSO SPPED INCENTIVE PAY

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General Motors Corp. early next year will standardize the way it assesses advertising by its six vehicle divisions, a move that will put competitive pressure on agencies and help pave the way for incentive-based compensation.

The move is being driven by a desire to share information among divisions, and was accelerated by the company's shift to a brand management structure, Philip Guarascio, VP-general manager/marketing and advertising for GM's North American Operations, told Advertising Age in an exclusive interview.

"It's not an `I gotcha' [for agencies] and it's not going to be a creative straitjacket," Mr. Guarascio said. "It's a process that's going to enable us to understand the best practices in terms of advertising. We can then transfer the learning because we're creating a common dialogue within the organization on the subject of advertising."

While Mr. Guarascio emphasized that GM, the nation's third-largest advertiser, didn't develop the process in order to evaluate agencies, it could provide a way to issue grades.

"It's fair to say that long term we need to move part of our compensation to some sort of partially incentive-derived system. We're going to quantify performance as much as we can," he said. "Whether this will represent that scorecard, we don't know. But if anything, this will improve the fairness of any incentives that might be based on advertising and marketplace performance because we'll have a broader base of experience on which to base incentive decisions."

GM's core agencies are Campbell-Ewald, Warren, Mich. (for Chevrolet); D'Arcy Masius Benton & Bowles, Bloomfield Hills (Cadillac and Pontiac); McCann-Erickson Worldwide, Troy (Buick); McCann/SAS, Troy (GMC Truck); and Leo Burnett USA, Chicago (Oldsmobile).

Agencies are currently paid on a commission and fee system, with compensation said to average about 9% of billings.

Mr. Guarascio said he believes GM advertising has improved significantly in the past two years but added, "there is a lot of upside potential."

The automaker, which annually spends an estimated $2 billion on advertising and other marketing activities excluding consumer and dealer incentives, hasn't dismissed a vehicle division agency since 1958.

Observers don't consider any changes imminent, though DMB&B faces a crucial test in helping the struggling Cadillac division introduce the Catera next fall. The Catera will be targeted to baby boomers, a group that has mostly scorned Cadillac. If DMB&B's work doesn't measure up, Cadillac could consider splitting Catera from the rest of the estimated $180 million account.

In January, 36 new brand managers at GM will assume broad marketing responsibility for specific models. They will determine ad strategy for their models, though divisional ad managers will still work with agencies on execution.

The standardized assessment program will give brand managers "the tools to do their jobs," Mr. Guarascio said.

Representatives from the divisions, agencies and Mr. Guarascio's staff are jointly developing a three-part assessment process covering strategic development, copy testing and market tracking. Mr. Guarascio said the system will have an effect on 1997 model year ads.

The strategic development part will have the most flexibility, offering divisions a toolbox of approved techniques such as focus groups and image positioning studies.

GM is examining various methods to test animatics and other copy in the second stage. For final tracking, the company has developed its own measurements.

One GM goal is a consistent message for each vehicle brand.

"In a broad sense, we'll be looking at whether advertising is on strategy, whether it is unique to the brand character and whether it resonates against its targets," Mr. Guarascio said. "Effectiveness will primarily be measured by credibility, by the ability to connect emotionally and on the persuasiveness level of advertising, as opposed to recall."

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