Akerson: GM's marketing approach not the result of 'one individual'
CEO, in wake of Ewanick's sudden departure, tells analysts strategy was team effort
Akerson: "I know a lot of public views this as a personality-driven industry. It's a team effort."
General Motors Co. CEO Dan Akerson, referring to the impact of Joel Ewanick's exit, told analysts and reporters today that the automaker's marketing is a group effort, not a one-man operation.
Asked about Ewanick's sudden departure on Sunday from his role as global chief marketing officer, GM Chief Financial Officer Dan Ammann began by saying, "The fundamental approach is, no change. The consolidation of agency spend, all the things we did with our media buy, those are all very real drivers of efficiencies and we're absolutely going to continue with those."
But then Akerson jumped in before Ammann had finished speaking.
Akerson began by saying, "Just to be clear, no one individual" -- and then stopped himself before continuing, "I know a lot of public views this as a personality-driven industry. It's a team effort. What you saw in the marketplace was a thought-out strategy that was agreed upon as a team."
Earlier in the call to discuss GM's second-quarter financial results, Akerson used prepared remarks to address recent executive changes that have raised concerns with some investors and Wall Street analysts.
"That may mean promoting leaders, who have motivated teams to achieve great things for our customers or could mean recruiting talent from outside GM to accelerate things," Akerson said. "From time to time, it will mean parting company with people who are not delivering expected results or alternatively who do not meet the higher standard for accountability and integrity. That's the way it has to be for all of us in order for the company to reach its full potential."
Ewanick, the rock-star CMO hired 26 months ago, was abruptly ousted on Sunday. A GM spokesman said the marketing guru "failed to meet the expectations the company has of its employees."
Since then, reports have emerged that Ewanick was asked to resign due to a botched sponsorship deal with English soccer club Manchester United that might ultimately cost GM upwards of $600 million, according to Reuters.
The change in marketing management, along with GM's struggling European operations, come at a sensitive time as the automaker readies a North American product blitz and strives to boost operating margins.
"Does GM face challenges of leadership or culture? Actually, we believe both," Morgan Stanley analyst Adam Jonas wrote in a report this week. "The 'new GM' has a dramatically improved financial position and productivity/breakeven point, yet still shoulders many of the burdens of 'old GM'. Recent events reveal a clear need for leadership across the organization."
Some analysts have speculated that Ewanick was let go because the advertising wasn't working.
The company's U.S. sales rose just 3 percent from January through July of this year, at a time when the auto industry as a whole was riding a 14 percent sales gain. GM's U.S. market share was at 19.9 percent in 2011; it's down to 18 percent so far in 2012.
Akerson added on the call, "Most of our metrics were not favorable compared to a year ago, and that is unacceptable."
Alan Batey, the automaker's interim global chief marketing officer, also said there would be "no change" in GM's marketing strategy. He spoke during GM's analysts' call on Wednesday to report a 6.4 percent drop in U.S. year-over-year sales during the month of July.
The company said the 6.4 percent sales drop in July was partly due to a 41 percent drop in sales to rental car companies, which it anticipated because planned deliveries occurred earlier in the year compared with 2011. Nonetheless, sales of Chevrolet brand were down 6.8 percent in July, GMC was down 9 percent and Buick was down 15 percent. Cadillac sales, however, jumped 21 percent.
Batey, Chevy's vice president of sales and service, was thrust into the role of commanding GM's $3.5 billion ad budget on Sunday after Ewanick's sudden departure.
"We've always been one team here, and there is no change in direction," Batey said. "There's no change in priorities. The team is focused on executing, and we've got a lot going on right now... There really is no disruption, no change."
In reality, Batey doesn't have much choice. GM launched two huge marketing initiatives in the month of July that have significant shelf life.
The Chevy "Love It Or Return It" program, in which buyers have 60 days to decide if they want to keep a newly-purchased Chevy or return it, no questions asked, runs through Sept. 4.
And the launch of the Cadillac ATS, more than a year in the making, started its marketing run on the July 27 broadcast of the Summer Olympics Opening Ceremony. GM is an Olympic sponsor and has more than 100 spots planned to run during the 17-day Olympics.
Batey was asked if he was making any evaluations of the poorly received "Chevy Runs Deep" tagline, or with the Commonwealth Detroit ad agency that Ewanick helped forge as a combination of Omnicom Group's Goodby, Silverstein & Partners and Interpublic Group of Cos.' McCann Erickson Worldwide.
His response: "Simple answer is no. As I told you, this has nothing to do with our strategy. We are executing as per our plan. We have always been one team, and that continues. So you shouldn't read anything into this that we didn't announce, and there is nothing else to add to that. But are we changing strategy? Are we evaluating any of our partners? No."