Cadillac brooms out its ad agency

Not even two months into the job, General Motors Co. marketing Vice President Joel Ewanick is already shaking things up. Adweek reported that he has replaced Bartle, Bogle and Hegarty as Cadillac’s advertising agency after six months with the account, handing the estimated $250 million in business to Fallon.

It’s not a big surprise. Ewanick is known for moving quickly and any new marketing chief will want to bring in his own people and favored agencies. Last month, he brought in San Francisco-based Goodby, Silverstein and Partners for the Chevrolet account, replacing Paris-based Publicis after just a few weeks. Publicis had been hired by GM before Ewanick arrived to replace Campbell Ewald, which did Chevy’s advertising for decades.

Even before Ewanick arrived, GM wasn’t blown away by some of the Cadillac work done by BBH. The company asked for changes several times, says one person with direct knowledge of Cadillac’s advertising. Cadillac wants ads that focus more on the cars and have less emphasis on sizzle and sophisticated graphics, the source said.

Expect more changes to come. Two people close to GM’s marketing operations say Ewanick wants to bring in some outside marketing talent to add some brain power to GM’s ranks. Given the company’s woeful marketing efforts in recent years and its brand-image challenges, it could be just what the company needs. The company’s brands have lurched from one marketing message to another for a decade, with a revolving door of marketing bosses to keep the churn going. Cadillac, for example, has had three marketing heads in a year.

And make no mistake, Cadillac is a big marketing challenge. Last year’s sales were the worst since 1953, albeit in a woeful car market. The brand ranked eighth among 12 luxury car brands in the Luxury Institute’s 2009 survey of people making more than $150,000 a year. Only one-third of respondents said the brand is worth paying a premium to buy, compared with 57% for BMW and 62% for Mercedes. At 62 years old, the average buyer is 13 years older than a BMW buyer. That’s a long way of saying that the brand isn’t hip. Cadillac has some strong models with the CTS sedan and new SRX SUV. But GM needs to get the core of the luxury consumers to check out the new, aggressively-styled and sporty models that are the antithesis of the brand’s old geezer image. Now it’s up to Ewanick and Fallon to get luxury buyers to give those cars a look.

Posted by: David Welch on June 25, 2010

GM Mulls a New York Showroom to Woo Wall Street

General Motors realizes it has a nagging little marketing problem as it prepares for an initial public stock offering. The analysts, portfolio managers and potential investors that they are hoping will like their stock aren't big customers of the company's cars. So GM is mulling over a plan to open up a GM salon in Manhattan, say three people who know about the discussions. The company would rent or buy a building, outfit it with imagery for its four brands and showcase the latest cars. The idea is to get GM's best models in a place where high-fashion New Yorkers, tourists and high-rolling investors might walk by. GM does poorly in the New York metro area. GM's market share in the New York area was just 9.6% in the first quarter, compared with 18.7% in the U.S. GM's share in the New York area was 10% last year, down from 13% in 2008, according to Experian Automotive, which tracks vehicle registrations.

GM thinks that the salon would show investors and car buyers that the company's newest models are competitive. Audi has a similar display called the Audi Forum at the corner of 47th Street and Park Avenue. Audi keeps five cars on hand, including a vintage Le Mans series race car. Audi has events at the Forum. They even kept it open so Audiphiles could watch the entire 24 Hours at Le Mans race last year.

For GM, this does create a bit of a dilemma. GM wants to get in front of the hip and the well-heeled. But is this the right way to do it? The Forum works for Audi because it's a house for just one brand. There is nary a Volkswagen in sight. GM would have four brands together at a time when the company is trying to give Buick, Cadillac, Chevrolet and GMC some individuality.

That isn't what's stopping GM. Executives say they like the idea of a company showroom in the Big Apple. But Manhattan real estate is really pricey. For a company perceived by some to be on the dole--and that took some heat for giving a Corvette to near-perfect Detroit Tigers pitcher Armando Galarraga--a Manhattan marketing scheme could draw heat. GM should pay no mind. The bigger question is whether GM could differentiate its brands with this, and any other companywide marketing strategy.

Posted by: David Welch on June 28, 2010