Auto marketing: GM corporate ads near $100 million

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General Motors Corp., which spent less than $10 million in corporate advertising just two years ago, is nearing the $100 million mark in measured media for corporate ads this year.

The auto giant started beefing up corporate spending last year after Sept. 11 with its "Keep America Rolling" campaign; through August of 2002, the marketer spent $94 million on corporate ads, according to Taylor Nelson Sofres' CMR.

The tenfold increase has far outpaced rivals, and while it hasn't grown GM's share, the ads-and the aggressive incentives they pitch-have kept GM from losing significant share in an over-saturated market.

Interpublic Group of Cos.' McCann-Erickson Worldwide, Troy, Mich., won the account two years ago from the now-defunct N.W. Ayer & Partners, Troy, Mich. In the past year, GM has evolved its brand management system with umbrella ad themes emphasizing each vehicle division: Buick, Cadillac, Chevrolet, GMC, Hummer, Oldsmobile, Pontiac, Saab and Saturn.

GM's "Overdrive" campaign is two-pronged, with separate retail and corporate branding commercials. The current corporate-brand TV spot shows urbanites discovering hot GM models in View-Masters. No prices or deals are shown.

C.J. Fraleigh, executive director-corporate advertising and marketing, said the ads aim to drive home to consumers the progress the automaker has made in recent years. "This isn't marketing puffery," he said. "At this point in our evolution we have more great-looking, high-quality products than we've had in years, and the job of advertising is to get that word out."

A corporate retail TV spot, also from McCann, shows various models on a white background with prominent "triple zero" offers (no down payment, no monthly payment for 90 days and no interest charges). "Our core strategy in going to market is to offer simple, compelling offers consumers understand," said Mr. Fraleigh. "We're out there trying to sell as many vehicles as possible."

The incentives have helped the marketer halt years of market-share decline. In the first 10 months of 2002, GM's market share was 28.5%, flat with the comparable period in 2001. But the total is down from its 29.5% share for the first 10 months of 1999 versus 29.1% for the same period in 1998 and 31.1% for January through October 1997, according to Automotive News.

Competition will stiffen next year when several Asian automakers open new plants in the South, adding more than 1 million units to an industry already faced with over-capacity, said Josh Peters, auto analyst at Morningstar Research.

But he also said that while "GM has the most competitive, quality lineup in a long time, it really still has that let's-make-a-deal mentality."

Michael Flynn, director of the University of Michigan's Office for the Study of Automotive Transportation, worries the retail ads could "cheapen the brands and temporarily submerge the divisional brands." But he said GM may have lost market share without the strategy.

While Mr. Fraleigh declined to discuss specifics, he stated that consumer's image and buying consideration for GM have improved with the corporate campaign.

"GM is flying in the face of car conventions because that's what leaders do," said McCann's David Moore, exec VP-executive creative director.

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