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GM WIDENS BRAND SETUP ZARELLA PUTS NEW MANAGERS IN 'KEY' MARKETING POSITION

By Published on .

Ronald Zarrella, the outsider brought in to shake up General Motors Corp.'s marketing, is doing it.

Under Mr. Zarrella's direction, the giant automaker is putting into place across all its divisions a brand management system more typical of package-goods marketers. Indeed, several of the 20 to 30 brand managers who will be named before the end of the year will probably be recruited from companies such as Procter & Gamble Co. and Johnson & Johnson, said Mr. Zarrella, group VP in charge of GM's sales, service and marketing.

Mr. Zarrella also sketched out changes designed to separate and clarify brand images for Cadillac, Buick and Oldsmobile; vowed that GM will give more consistent ad support for its models; and said GM is looking at whether it needs seven separate distribution channels for its cars and trucks.

The marketing reorganization shows why John Smale, the former P&G chairman who now holds that title at GM, insisted the carmaker consider an outsider for the top marketing position at GM's North American unit, which accounts for nearly $100 billion a year in sales.

Mr. Zarrella left his job as president-chief operating officer of Bausch & Lomb Corp. to join GM last Dec. 12. Not being an automotive insider, he isn't tied to traditional perspectives that may not apply to an increasingly consumer-driven business.

GM's brand management ap proach will be similar to one put into place last year by its Pontiac division, with the added provision that brand managers will get profit-and-loss responsibility for the car brand models they oversee.

The Cadillac division recently adopted a similar concept for its Catera, the small luxury sports sedan that will debut in mid-1996.

Pontiac has three brand management teams with broad authority to ensure product features and marketing programs match a car's image. It's different from the traditional GM setup, where separate managers for advertising, pricing and sales promotion make decisions for all models.

GM's ad agencies, with their experience working for non-automotive clients, could play a key role in training the automaker's executives in brand management. For instance, D'Arcy Masius Benton & Bowles, Bloomfield Hills, Mich., used the expertise of P&G account execs to help introduce Pontiac and Cadillac executives to package-goods brand management thinking.

"We want the brand manager, who is the one person responsible for the vehicle line brand, to be able to manage all of the key elements of the marketing," Mr. Zarrella said. "The manager and his team will be in a position to make trade-offs of those elements such as price, product content or advertising funds as necessary to balance profitability and build long-term brand equity."

The changes will be felt most at the division level and aren't expected to affect Philip Guarascio, VP-general manager in charge of North American marketing and advertising. He would remain in overall charge of the $1.5 billion GM media budget.

On the question of sorting out brand identities, Mr. Zarrella said Cadillac will move upscale and take on an international flavor to compete globally with the likes of Mercedes-Benz, BMW and Lexus. Buick will take over the role of going up against domestic luxury cars such as Lincoln.

Oldsmobile, which has been putting into place Saturn-like customer-care programs, will be positioned more clearly as "the logical place for Saturn owners to go" when they want a larger car, Mr. Zarrella said.M

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