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Marianne Paskowski

Car Ad Sales Woes

August 29, 2006 1:33 PM

This is thetime for new car sales and some strange things are a pedal. Suddenly gas prices have come down 10 cents a gallon --hello OPEC-- just when all the new models are coming out.

And then there are two strange blips on the radar screen. First, Ford announced that it might take the company private. God knows what that means for TV ad sales. And then Toyota announced that it was scaling down production to re-examine quality-control issues. Same issue.

My husband just ran his aging Tahoe into the ground. I, of course, drive a more sensible but ugly Toyota RAV-4 a four-cylinder car that I call “Baby Dumbo,” because it looks like a dwarf elephant.

We wound up replacing the Tahoe with a new ’06 Toyota Sports Edition 4-Runner, priced to move off the lot for the new models, soon arriving. We didn’t buy it based on a single ad we saw on TV. I didn’t even know it existed. Nor did he.

We researched online and at the gym. Anyone who knows jack about cars would say this is pretty stupid. It’s an 8 cylinder gas guzzler. But we live on Cape Cod and Bob wanted an off-road vehicle for the beach. And this baby performs. In other words, people make decisions, for better for worse, not based on TV ads but from word of mouth and now the Internet.

That has some ramifications for the auto industry, which has the worst screaming, high-decibal dealer ads on TV. So what did you buy? And what will you buy and how will you reach your decision?

I doubt it’s from a TV ad.


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Comments (10)

Janet Stilson:


Just back from Costa Rica. Forgot the sound my own cell phone makes.

Luckily I don't have to deal with the car situation, being a Harlem girl. But you remind me of a question I've been having lately -- and I suspect you know the answer immediately.

Would it be possible for an advertiser like Ford, or say an ad conglomerate like Carat, to just buy a media company like Viacom? My gut tells me there's some FCC reg that would nix something like this. But rules are for remaking, as Mr. Murdoch reminds.

Marianne Paskowski:

OK. Disclaimer numero uno: I am not a legal beagle, nor ever played one on TV. Second: the kinds of marriages you suggest, I do believe are legal. Third: the point is so many advertisers and agencies are already forming their own production facilities

I don't theink them have the stomach to buy a company like Viacom. Too risky

I've always said content is king. But I do think that agencies and advertisers want more ROI. And that's what's afoot. End game: just a new twist in an age old negotiation among buyers and sellers. I know that is a total non answer, but I'm sure there's somewhat far smarter out here you might want to chime in.

Janet Stilson:

Duh. I suddenly remembered GE owns NBC Universal. So that half of the question is answered.

Marianne Paskowski:

So I'm assuming the other half of your question is , can a media buying service like Carat buy the likes of Viacom? Sure. Why not? But why would k Carat want to buy a company like Viacom? If that were to happen Carat would be throwing away its sales commission (made from clients) and heap on a pile of debt.

Welcome back from Costa Rica, excuse my earlier breach of etiquette.

Janet Stilson:

My thought was, they could devise even more ingenious ways of reaching consumers by "driving the bus" themselves ... and at better prices for their clients ... and shutting out competitors from key brand content. And maybe those commissions don't go away.

The debt part is another thing ... That's probably where my idea falls apart. I was just mainly interested in how the game could change.

Thanks for your wisdom on the subject.

-- Janet

Marianne Paskowski:

Sounds like you're working on an interesting piece? Everyone seems to think more consolidation is coming. We've seen it on the sell side with distributors morphing into mega giants. We've seen it on the buy side with the likes of huge entities like Carat. And we've seen it on the client side with the consolidation of banks, auto makers, packaged goods outfits, etc. Maybe you're asking if a large advertiser needs a buying service or, middleman, or should just deal direct? Not a new idea, several big advertisers always liked to keep that function in house. Old in-house, out-house (pardon the bad pun) debate.

Toyota had some serious issues to deal with internally on the quality control line. Something with the QC documentation not being properly propagated across the plants.

These are really great posts. I appreciate your sharing this stuff with us and providing an open forum for comments. Very Web 2.0 !

Marianne Paskowski:

True confessions. Own two Toyotas now, a Rav4 and a 4-Runner. Best cars I ever owned in my life. GM is in the gutter. The ad sales market is gonna suffer from the weakness of the American car market. I feel a little guilty, but not that guilty.

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