How to sell a dying brand

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The 103-year-old Oldsmobile brand is on a death march.

But the General Motors Corp. division still must launch its redesigned Bravada sport utility early next year. Oldsmobile's dilemma is how to advertise the launch of its last new model and market the rest of its lineup.

"You have to accept the fact you're dealing with emotionally damaged merchandise," said John Bulcroft, an ex-car marketing chief and now president of consultancy Advisory Group. "How do you convince people to buy an orphan?"

He recommended Oldsmobile sell the Bravada as a classic, "the last in a fine generation of vehicles." GM needs to either advertise an extended warranty on Oldsmobiles (currently 36,000 miles or three years) or "discount like crazy" to clear out the products, he added. The longer the brand sticks around, the more it will cost GM to unload Oldsmobiles.

Ronald Zarrella, president of GM North America, said recent Olds buyers will be offered a choice of a $1,500 incentive to buy or lease another Oldsmobile or $1,000 for other GM vehicles. Those deals are on top of existing incentives.

Oldsmobile will spend roughly a week doing a "deep-dive discussion" with consumers about the barriers to buying an Oldsmobile today, a spokesman said. Then, it will adjust its ad message accordingly.

Plans for a first-quarter divisional brand campaign, currently in review, were cancelled. "Obviously, we're not into brand building, we're into brand selling," the spokesman said.

Yet the Olds spokesman said an agency review for a branding assignment is proceeding with incumbent Leo Burnett USA, part of Bcom3; Interpublic Group of Cos.' McCann-Erickson Worldwide, Troy, Mich., agency for Buick; and E. Morris Communications, Olds' African-American shop.

Said a Bcom3 spokesman: "They are at the beginning stages of developing a strategy."

When asked whether Leo Burnett was simply trying to stay linked to GM in hopes of gaining another brand, the spokesman said, "Our focus right now is on Oldsmobile. GM is a very important client of the Bcom3 Group, and we naturally look for ways to further strengthen that relationship in any way we can." Bcom3's D'Arcy Masius Benton & Bowles handles GM's Cadillac and Pontiac.

McCann-Erickson, Troy, Mich., presented "slightly different" creative Dec. 14, two days after GM announced it was scrapping Olds, said Garry Neel, exec VP-managing director of the office.

Asked whether the prospective client sought more work, he said: "We are continuing at their request and our initiative."

Auto expert Susan Jacobs, president of consultancy Jacobs & Associates, predicted consumers' primary concern will be where Oldsmobiles will be serviced after the division disappears.

Dealers with other GM brands will handle that, the Olds spokesman said.

But ads need to provide assurances of that, advised Tom Healey, a partner at consultancy J.D. Power & Associates.

The division should approach current owners; trying to conquer competitive owners would be a waste of time, said Ms. Jacobs. Each vehicle must be marketed on its merits, not tied to the Oldsmobile brand, she added.

"GM should try to build a bridge for Oldsmobile owners to another GM division" to keep them in the fold, she said. And if GM plans on moving any models to other divisions, she said, it should do it as soon as possible as part of that bridge.

Clever financing may be the way to go, considering the number of Oldsmobile customers GM could retain for dual-brand dealerships, suggested Mike DeMaio, managing director, Burrell Communications Group. Mr. DeMaio led GM dealership marketing for more than 30 years.

"The financing tactics will be really important in determining how successfully they retain those Olds customers," he said. "GM's strategy has always been to advance the customer from entry level with Chevrolet through the family of products to Cadillac as consumers aged and got more affluent," Mr. Zarrella said. GM may move certain unspecified Olds models to other divisions, but no final decision has been made.

ORDERLY PHASE-OUT

DaimlerChrysler Corp. seamlessly handled an orderly phase-out of auto brands when it killed Eagle at the end of the 1998 model year and Plymouth, which dies at the end of the 2001 model year,

Ms. Jacobs said. That's because Plymouth dealers also handled the Chrysler brand, which now sells the former Plymouth Voyager minivan; Eagle dealers also had Jeep stores.

GM would have been smarter "to swallow the regulatory and legal issues and just cut off the Olds line at end of the model year," said Gerald C. Meyers, former chairman-CEO of the now-defunct American Motors Corp., the marketer of Jeep and Eagle models that Chrysler acquired in the '80s.

"What kind of insanity is it to continue promoting and advertising when the traffic is drying up and you have a lame-duck product," said the business professor at the University of Michigan. "I think they're going to be surprised at how fast it dies," he added. Mr. Meyers bets "they don't take a single new-car order from a dealer after March 31."

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