GM ad boss takes agencies to task

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Agencies lack the big ideas that sell products, while holding companies are "flabby" organizations that have become "more revenue models than consumer-solution models," according to C.J. Fraleigh, executive director of advertising and corporate marketing at General Motors Corp.

Speaking at AdWatch: Outlook 2003, presented by Advertising Age and TNS Media Intelligence/CMR, Mr. Fraleigh, who controls the biggest U.S. ad budget at $3.6 billion, spared few blushes as he panned agencies for being too conservative and unable to come up with ideas strong enough to justify GM spending more with them.

With David Bell, chairman-CEO of Interpublic Group of Cos. sitting just yards away, Mr. Fraleigh also said holding companies had not helped provide the solutions they once promised. General Motors has holding company relationships with both Interpublic and Publicis Groupe. Earlier this month, Mr. Fraleigh voiced anger at Publicis Groupe-owned Saatchi & Saatchi, which hired away a veteran GM employee, Kurt Ritter, to work on its Toyota account. Mr. Ritter is no longer working at Saatchi and has set up his own shop as a consultant (see story, P. 6).

Mr. Fraleigh told an audience of 400 delegates that the ad industry would lose its customers, as GM once had, and would find it difficult to woo them back if it did not work harder to find big ideas that sell.

Media companies also incurred Mr Fraleigh's criticism. He said that just as the agencies are not creating the great selling ideas that they came up with in the days of David Ogilvy, Leo Burnett and Bill Bernbach, so the media companies' ability to deliver great business solutions has waned. "I have to step back and question the absurdity of paying double-digit increases in the upfront for a dwindling audience," he said.

blank checks

His demands for new ideas, reminiscent of a similar clarion call from Coca-Cola Co. President-Chief Operating Officer Steve Heyer at Advertising Age's Madison + Vine conference, prompted a volley of calls from eager agencies. But that was hardly surprising, since the former PepsiCo marketing chief did show slides of blank checks during his presentation. "I've got a blank check up here," he said. "It could be made out for $10 million or $100 million or more."

Many viewed his comments as a "cattle call" to non-roster agencies, and while Mr. Fraleigh did give some support to his current agency partners, he also said the right idea could come from anywhere.

Patrick Sherwood, CEO of Publicis Groupe's Chemistri, Troy, Mich., said he was buoyed by Mr. Fraleigh's speech, not threatened. That's partly because Mr. Fraleigh named Chemistri's executive creative officer, Gary Topolewski, as one of the talented agency people. Mr. Sherwood also felt the GM ad czar referred to Chemistri's new model of creating media-neutral marketing programs when he spoke about seeking new innovations from its roster shops.

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