GM Roars Forward Into Digital Ad Channels

Mar 18, 2008  •  Post A Comment

The country’s third-largest advertiser is getting ready to shift fully half of its $3 billion budget into digital and one-to-one marketing within the next three years. And as GM goes, so goes the entire automotive industry — the leading advertising category that pumped some $9.42 billion into the ad economy last year.
The goal is to go well beyond the banner — GM spent $197 million in online ads last year, according to TNS Media Intelligence — to encompass gaming, search, mobile and a broad array of interactive applications, according to several executives close to the automaker. In the last few years GM has shifted several hundred million dollars from TV and print to digital and one-to-one, and that trend will accelerate, said the executives.
The clearest sign yet of the automaker’s plans came in the last couple of weeks with changes at its dedicated media agency GM Planworks. First Dennis Donlin, longtime general manager and president of the agency, left and was replaced a few days later by Ken Taylor. But Mr. Taylor, who was previously exec VP-group client leader at sibling Starcom USA, Chicago, has been tasked not just with leading the agency’s efforts on behalf of GM, but also with reintegrating Planworks into Starcom MediaVest Group.
‘No offices will close’
Laura Desmond, CEO of Starcom MediaVest Group for the Americas, declined to comment on specifics of the move, but said, “As GM has streamlined and got more agile, it seemed only appropriate to move from a siloed business approach to a more flexible, nimble approach that’d allow them to access all our centers of excellence.” She denied this meant a total disbandment of Planworks, noting that no offices would close.
The idea, according to Ms. Desmond and Betsy Lazar, GM’s director-advertising and media operations (who was speaking to Automotive News), is to break down walls at Planworks — until now a self-contained business unit for GM — and allow it to share the resources of the entire SMG Group. That means GM will be able, for example, to tap the expertise of MediaVest’s branded-entertainment division, run by Brian Terkelson. It’ll also be able to take advantage of SMG’s buying and planning clout, and tap MediaVest and Starcom’s top researchers. Importantly, it will also allow Digitas and SMG to work closely together on digital planning and execution.
SMG will work with GM, much like the way it works with Procter & Gamble or Coca-Cola, bringing a range of resources to bear.
Mark LaNeve, VP-vehicle sales, service and marketing for GM in North America, declined to talk numbers, but said, “Like all major marketers, we’ve moved into digital media in a big way,” adding, “but the other media types are still very important and will still be a big part of our mix.”
Online product research
But a pattern is developing among automakers whereby TV and print are deployed for launches in order to raise awareness, while more of the continuous branding and sales activity shifts online — as automakers and many of their dealers accept that the purchase process increasingly begins, and sometimes even effectively ends, on the internet.
At a time when a slowing economy is taking a toll on advertising, the prospect of billions of dollars fleeing TV, print, newspaper, radio and outdoor is unwelcome, to say the least.
The worse news for traditional media: GM’s Brent Dewar, VP-field sales, service and parts in North America, told Ad Age last December that the marketer will try to persuade its regional dealer ad groups “to shift their focus to digital vs. spot TV” starting this spring after the dealer co-ops, which spend some $500 million annually, are revamped.
Hyundai Motor America is doubling its online ad spending this year over 2007, according to VP-Marketing Joel Ewanick, who declined to offer specific figures. “Online is getting to the point where it may be more important than the 30-second TV spot.”


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