GM Marketing Could Use a Savior - Or At Least Some Successes

GM Marketing Could Use a Savior - Or At Least Some Successes

By Michelle Krebs June 7, 2010

Great products underlie the most effective promotion, and in that regard General Motors is on a promising path with its new vehicles. But GM hasn't done itself any favors with its marketing for a long time, and consistently poor execution in that arena threatens to undermine much of the progress being achieved in the marketplace by its hot car launches.

Three of GM's four remaining brands are still at least somewhat amorphous. The company continues to churn up not only in-house marketing leadership but also its crucial advertising-agency relationships. Dealers remain restive partly because of GM's continuing efforts to weed out the unproductive dealerships.

"I've never seen anything like their agency merry-go-round," said a marketing executive for a primary competitor of GM. "If your partners are in flux and your leaders are in flux, people at GM don't even know who they're supposed to answer to. And they haven't been able to communicate a plan to a distribution system where dealers need to plan six to nine months in advance."

Meanwhile, handlers can't seem to decide whether CEO Ed Whitacre should be a fixture of GM advertising or just get out of the way - and what he should say when he's in front of the camera. And GM may be relying way too much on the messianic capabilities of Joel Ewanick, its incoming chief marketing officer just stolen from the clutches of Hyundai by way of Nissan.

"Now we're going to find out how good Joel Ewanick really is," said Joseph Phillippi, president of AutoTrends Consulting in Short Hill, N.J.

Full Platter

GM hasn't made Ewanick available for comment yet, but it's not difficult to figure out what the new guy sees piled onto the plate he was officially handed May 24. He became GM's third U.S. CMO in the last several months and the first after bankruptcy who hadn't risen through the company's own ranks.

"My sense is that at GM there is no plan; there is no road map; there is no considered strategy for the company, and that leaches down to marketing," the rival marketing executive said.

Recently retired GM Vice Chairman Bob Lutz confirmed his competitor's evaluation. "It wasn't our agencies, it was us," Lutz recently told the Detroit Free Press, months after he had assumed overall responsibility for GM's sales and marketing in addition to his supervision of product development. "Our requirements, our procedures, our own attitudes," he said, undermined GM's message and its products.

So what now? Ewanick demanded and got nearly complete autonomy over GM's North American marketing because he clearly saw the mess he would be inheriting. So non-negotiable was the point that Whitacre's early reluctance to give him such authority meant Ewanick spurned GM's initial efforts to recruit him.

In Search of Chevrolet

Straightening out the Chevrolet brand obviously is at the top of Ewanick's to-do list. Cadillac remains well-defined as GM's luxury marque; Buick is coming on; and GMC seems to be transitioning to a position as the main repository for the company's pickup trucks and larger SUVs.

Popular new vehicles including the Equinox crossover and, to a lesser extent, the Camaro are keeping Chevy on the minds of American consumers, and GM executives believe the new Cruze subcompact due later this year - as well as first sightings of the Chevrolet Volt extended-range vehicle - will continue to kindle enthusiasm.

But GM also would like to help Chevrolet with some effective marketing at long last. After decades of having to differentiate and peddle eight distinct brands, the company's marketing culture is still adjusting to valuing the Chevrolet brand - which accounted for 73.5 percent of GM's U.S. sales in April - as "the franchise."

That's one reason it still hasn't come up with effective positioning for Chevrolet. The latest wishy-washy advertising theme is "Excellence for All."

"What is that?" said Rebecca Lindland, head automotive analyst for IHS Global Insight in Boston. "Chevy is such a great, iconic American brand that GM may be better off embracing it rather than trying to run away from it."

Maryann Keller suggested GM might even consider reviving ancient advertising themes that at least effectively connect consumers to the mainstream of Chevrolet's brand. "Is it time for 'See the U.S.A. in Your Chevrolet' again?" said the long-time industry consultant and former securities analyst.

Sense of Urgency

Ewanick already has ordered an abrupt shift in creative duties for the $600 million Chevy advertising account to Omnicom Group's Goodby, Silverstein & Partners - which handled Saturn marketing in the mid-2000s -- only weeks after it was consolidated at Publicis Groupe's Publicis.

That move had followed by only a few weeks GM's neutron bomb: taking the Chevy account away from Campbell-Ewald after 91 years on the job and the agency's delivery of classic campaigns ranging from "Like a Rock" to "Heartbeat of America."

On the other hand, Buick already has made some progress in refining its brand identity, which had been adrift for decades. Even GM's decision a decade ago to jettison the overlapping Oldsmobile brand didn't allow Buick to settle clearly in the minds of American consumers. For several years the biggest association Americans made to Buick was its association with Tiger Woods - which, fortunately, the brand ended early last year, before the golfer's personal meltdown.

A Place for Buick

Now, however, the demise of Pontiac leaves only Buick to occupy for GM the vast demographic and psychographic turf between Chevrolet and Cadillac. So Buick brand stewards have been pressing the envelope, with new products and advertising that position Buick as a near-luxury threat to upscale brands such as Lexus -- a lineup exciting enough to attract much younger buyers than the Buick of old.

Buick already brought down the average age of its buyers from early 70s to today's 66 with new products such as the Enclave crossover and the LaCrosse sedan. And the target for the upcoming Regal is drivers in their 40s or 50s.

Consumers today "are making more rational choices" of autos in the wake of the Great Recession, Craig Bierley, director of Buick advertising and sales promotion, recently told MediaPost. That bodes well for a Buick brand that is trying to position itself, he said, as "unpretentious luxury."

Meanwhile, when it comes to GM's pretentious luxury brand, Cadillac, Ewanick reportedly already is trying to move its marketing messaging in another direction. Under new agency Bartle Bogle Hegarty since January, Cadillac's advertising slogan now is, "The Mark of Leadership." According to Marketing Daily, Ewanick doesn't believe that approach can sustain Cadillac's brand positioning over the long term.

Personal Brand

The most problematic bit of brand management for Ewanick may be Whitacre himself. The new CEO seems to have a bent for using advertising to provide the American people with broad updates about GM's comeback. And there has been speculation that Ewanick - whose career took off after he came up with Hyundai's Assurance marketing campaign in 2009 -- might be capable of crafting an effective corporate marketing message for his new company.

But Keller is among GM observers urging Whitacre to become a scarce marketing presence. "Those kinds of campaigns are disingenuous, and people either don't believe you or they hate you," she said. "Besides, no one has ever heard of [Whitacre]; he's not comfortable in front of a camera; and he has no credibility as a car person.

"Stick with your four brands."- Dale Buss, AutoObserver Contributing Writer

Michelle Krebs:  is Editor-in-Chief of AutoObserver.com. Follow @AutoObserver on Twitter.