General Motors has devised a three-level rating to help schedule ad spending under its new regional program that began April 1.
The regional ratings, based on GM's total U.S. market share, are: above-average, average and below-average, according to two GM managers close to the situation and two dealers, all of whom requested anonymity.
Since April 1, GM has been spending the bulk of regional ad dollars in the above-average markets to advertise high-volume brands, the managers said. Before the change, which eliminated GM's regional dealer ad associations, retailers were concerned that regional ad dollars would move to areas in which GM was trying to increase its market share. The dealer groups spent about $600 million annually.
GM declined to make national marketing executives or regional marketing managers available to discuss the new operation.
'We're not prepared to talk about regional advertising because it just started,' said spokeswoman Donna Fontana. 'This is a complicated transition, and things don't happen with the flick of a switch.'
She said about 85 percent of GM dealers have signed up for the new co-op ad program for their individual stores. Requests to interview GM people, made over nearly two weeks, were denied.
Still, some dealers have been groping to understand the changes and what they ultimately will mean to local advertising.
As president of the Television Bureau of Advertising in New York, Ave Butensky has discussed GM's new regional ad system with many of the 500 local TV stations his group represents. He said there seems to be a 'communications gap over how this is supposed to work, at least as portrayed to us by the (former GM) dealer groups.'
At least nine dealers, several of whom serve on newly formed dealer advisory boards across the United States, said the regional marketing staffs have left them in the dark about current or future ad plans.
All nine said their defunct regional ad associations have money left over, which they now are spending. Several of the new advisory boards are meeting for the first time this month. One dealer said it's too early to discuss the new regional advertising system.
PRO AND CON
Although dealers said they haven't been informed of regional ad details, at least two report positive signs.
A Boston-area dealer said he's seeing many more ads on early-evening news programs of major local stations, which his association had been unable to afford.
A Florida dealer has seen commercials for a new statewide lease program, which he assumes were done by the region.
But a Maryland dealer said he had to change his dealership's ads twice within a short period of time because the region changed customer incentives.
Butensky said he conducted an informal survey about GM's ad spending at a recent meeting of Television Bureau of Advertising's sales advisory committee of 35 sales managers from different markets. He found wide swings, with some stations reporting increases of 100 percent or more, while others were down dramatically.
Unlike GM's defunct dealer associations, GM has stricter criteria for buying ad time in local markets, he added. GM is seeking what is called 'pod exclusivity,' which means GM would be the only car advertiser during a single commercial break of a program. 'To what degree the stations yield, I don't know,' he said.
Ted Pearce, general sales manager of WDIV, an NBC-affiliate TV station in Detroit, said it could take stations six months to figure out how GM's new system works. 'We're trying to understand this new game,' he said, 'and part of that game is there's a lot of money in the pot.'