TV Upfront

GM's Second-Quarter TV Cuts Put Spotlight on Upfront

Carmaker Cites 'Normal' Business

By Published on .

General Motors said it has cut its second-quarter ad commitments to broadcast and cable, a move that suggests the climate for the next TV upfront may not be as robust as it has in the recent past.

In response to questions about reports that GM had cut the ad money it had allocated for second-quarter TV advertising on broadcast and cable by as much as 50% -- the maximum typically allowed under many upfront agreements -- General Motors spokesman Patrick E. Morrissey said, "This is normal course of business as we adjust our media mix to align with our priorities for the year, and to be competitive in the marketplace."

General Motors, which is running four separate ads in this weekend's Super Bowl, has cut back elsewhere recently. For the first nine months of 2011, GM reduced its spending on major media by about 12.2%, according to Kantar Media. Chevrolet announced this week that it has withdrawn from the prestigious 2012 British Touring Car Championship program in the U.K., where Chevy had been a major force for the past two years.

Even so, General Motors remains one of the nation's five biggest spending advertisers. In the first nine months of 2011, the make of Chevrolet, Cadillac and Buick spent about $1.3 billion, according to Kantar. Any of its bigger moves raise the possibility that other marketers may be moving in lockstep.

In recent months, the market for so-called "scatter" advertising, or ad inventory purchased much closer to air date, has slowed. Viacom said Thursday that its scatter business declined during the fourth quarter. Its ad sales are improving in 2012, however, with many buyers returning to the market, the company said.

Soft demand for "scatter" advertising suggests advertisers won't feel as much pressure to purchase ad time in the "upfront," that late-spring session when they commit to the bulk of the TV networks' coming fall schedule. That augurs a tougher time for the networks this year, after two years of price increases and robust demand.

Already, one prognosticator has suggested volume at this year's upfront will not rise. At Pivotal Research Group, analyst Brian Wieser has called for dollar volume that is "essentially flat when compared with the 2011-12 Upfront," he wrote in a recent research note.

Most Popular
In this article: