Top 100 Megabrands

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Chevrolet just keeps on blazing the trail.

The Chevrolet vehicle megabrand drove $762.4 million into media advertising in 1999. That makes the General Motors Corp. division the top spender for the second consecutive year among Advertising Age's Top 100 Megabrands. Light trucks and sport-utility vehicles claim 60% of Chevy's ad spending.

The marque's overall media expenditures, up a healthy 18.1%, seemed part of an all-out effort by parent GM to buy market share with advertising. Even with sales up demonstrably at GM--a fact shared by most major auto brands in 1999--GM's share remained flat. Chevy slipped 0.2 percentage points to a 15.3% market share, although Chevy trucks advanced 0.1 points to a 20.9% share of the light-truck market, according to Ad Age sister publication Automotive News.

The ad stimulus coming from Chevrolet and other automobile megabrands pushed Top 100 media spending 16.7% to $23.6 billion, or 27% of all advertiser spending. That measured media amount hit $87.79 billion, up 9.8% from the previous year.

Media growth of 9.8% for all advertisers is one of the best recorded.

And yet first-quarter 2000 results seem poised to raise the annual growth advances another notch. First-quarter media spending rose 12.7% to a record $22.2 billion, according to Competitive Media Reporting. Two spending stimulants, the Sydney 2000 Olympics and U.S. election races, should help sustain that level through the year.

Beneath the Top 100, spending increases in 1999 tapered off rapidly. Spending growth of 8.8% put the second 100 megabrands at $8.21 billion (see chart on Page S-18).

Entry into the elite 100 rose from $94 million in 1998 to $109.8 million, recorded by the Allstate insurance megabrand. The second 100 closed out at $61.6 million for FedEx Corp.

Autos, boosting their ad budgets an average 19.7% among the Top 100, were hardly alone in leading the charge. Robust spending came from other $1 billion-plus ad categories: Financial services, up 44.5% (see story on Page S-16); computers & electronics, up 25%; and telcos, up 23.4%.

Less pronounced were retail, up 6.8%, food, up 8%, and restaurants, up 9%. Retail's ad volume, second to auto's, held 16.5% of Top 100 spending.

No major medium recorded less than double-digit growth among the 100. Network TV, attracting one dollar in three spent by the 100, grew 13.4%, cable TV networks advanced 34.4%, newspapers 23.8%, magazines 16.1% and spot TV, 10.1%, according to CMR. For this report, Ad Age calculates megabrand totals from CMR's spending by brand and parent in the 11 media monitored (see methodology on Page S-10).


Autos remain the dominant force in this report. The 24 auto megabrands in the Top 100 account for 52% of all auto media spending. These 24 megabrands delineate nearly 13% of all network TV and spot TV advertising and 10% of magazine spending.

Detroit turned over its best sales year ever in 1999--16.96 million cars and trucks, up 8.7%--fanned by a strong economy and fatter ad budgets, particularly from GM.

Despite an 8.9% growth in unit sales, GM couldn't budge the market share of 29.4% set in 1998. But then, even 0.2 share growth is considered successful in an extremely competitive market.

GM spent $2.71 billion on the eight GM megabrands carried in the Top 100, an increase of 36.9% from the previous year. GMC truck spending roared 108.6%, Cadillac spending grew 50.7%, Buick 49.1%, Pontiac 41.6%, Oldsmobile 36.5%, Saturn 30.8% and Chevrolet 18.1%.

GMC trucks rose 0.4 share points to 6.4% of market as unit sales advanced 15.8% in 1999, according to AN. The Sierra bore the unit-sales weight of the division, accounting for 40% of division sales. With $88.2 million in support, Sierra absorbed 36% of GMC's media pot.

Buick funneled ad dollars into its big three: Century at $75 million, up 63%; LeSabre at $68 million, up 74%, and Regal at $49 million, up 69%. Buick share remained stuck at 2.6%.

Cadillac's Escalade SUV pulled nearly $50 million in advertising its first year, and leasing programs for the DeVille and Seville were powered with new ad dollars. However, the Cadillac share still declined 0.1 to 1.1%.

Oldsmobile's big spending hike came from a boost in Alero to $98 million for auto and leasing advertising, up 81.5% from 1998. Its share remained at 2.1%.

Pontiac leveraged its popular Grand Am in advertising for other Pontiac makes. It funneled a combined $100 million into these joint ad efforts. That's double what was spent solely on Grand Am in 1998. Pontiac's share rose 0.2 points to 3.6%. Grand Am, whose unit sales grew 30.2%, is credited with nearly half the Pontiac share.

Chevrolet backed trucks to the hilt. For instance, Blazer got $66.6 million, up 26%, and Silverado doubled ad support to $98 million. Among autos, the redesigned Impala collected $66 million in its first year.

Other big automakers fared worse than GM in 1999. Ford Motor Co. slipped 1.1 share points to 24.7%; DaimlerChrysler dipped 0.5 points to 16.7%. Honda/Acura, Nissan/Infiniti and Toyota/Lexus were flat.

Share-point stars were smaller foreign marketers, particularly Volkswagen of America and Hyundai Motor America. VW grew 0.5 to 1.9% of the market driven by two of its marques: top-selling Jetta, accounting for just over half VW unit sales, and the new Beetle. Jetta pulled $116.6 million in media, up 214%; the Beetle drew $31.6 million in its intro year.

Hyundai rose 0.4 share points to 1% of market largely behind unit-sales growth of the Elantra. But most of the ad dollars backed the higher-priced Sonata. It drew $62 million in media, up from $7.2 million in 1998.


AT&T Corp. led the set of nine telecommunications megabrands. AT&T Wireless drew the largest AT&T support of $136 million, up 36%, with $35 million reserved for the wireless store, up 88%. Ad expenditures for 1-800-CallATT more than doubled in 1999 to $110.5 million. First-time spending for AT&T Personal Network and AT&T 00-information drew $92.6 million and $68.4 million, respectively.

AT&T's 10-10-345 long-distance direct-dial brand was not tallied as part of the AT&T megabrand because of its expressed disconnection from the AT&T logo. The 10-10-345 brand hit $60 million in media spending, an increase of 169% over 1998.

MCI WorldCom produced four megabrands among the Top 100 this year: Direct-dial megabrands, 10-10-220 at $218.4 million, up 235%, and 10-10-321 at $152.6 million, down 14.6%, respectively. Also, 1-800-Collect, which purposefully avoided its MCI connection, received $164.5 million in ad support, up 11.4%, and MCI WorldCom megabrand saw spending of $177.8 million, down 18.7%.

Sprint Corp. boosted spending 33.5% to $470.1 million, its largest segments being Sprint PCS digital service ($176 million, up from $12.6 million in 1998) and Sprint residential long distance ($172.9 million, up 1.2%).


Hewlett-Packard Corp. under new CEO Carly S. Fiorina, launched a $200 million global brand campaign and a new logo in 1999; it boosted U.S. media spending 86.8% to $167.7 million.

Top PC seller Compaq Computer Corp. allocated $166 million in media, up 37.4%, and then switched agencies on its $300 million worldwide account this year, dumping DDB Worldwide for FCB Worldwide.

Dell Computer Corp. pushed total spending 66% to $156.8 million behind new agency BBDO Worldwide to remain the No. 1 direct PC seller. Gateway reached $223.9 million, up 22.2%.

The IBM Corp. megabrand continues to lead the computer & electronics category of the Top 100 Megabrands at $275.6 million, up only 1.9%. The category advanced 25% to $1.6 billion.


Retail sales remained strong throughout most of 1999, although megabrands J.C. Penney and Sears, Roebuck & Co. stores marked time, holding at 1998 sales levels.

Penney's media outlays slipped 5.6% to $300.6 million as its retail sales hovered near 1998 levels. Earlier this year, it hired Vanessa Castagna, the apparel maven at Wal-Mart Stores, to spruce up its merchandise. Penney's is in the process of shuttering 45 department stores and 289 Eckerd Corp. drugstores as part of a $530 million restructuring plan. Additionally, Penney's plans to sell its credit-card business and 20% of Eckerd Corp.

Sears' megabrand spending fell 2.8% to $556.1 million as sales at Sears' stores improved slightly over 1998 sales. Sears began reducing the size of its apparel bulk in 1999 by eliminating a number of vendors and continues that reduction in 2000.

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