When it comes to advertising spending, General Motors is king of the hill in the automotive industry with a $2.5 billion ad budget. But how effectively that money is being spent is the chief concern of CJ Fraleigh, the General's new executive director of corporate advertising and marketing. Fraleigh, 37, came to GM in January from Pepsi Cola, where he was vice president of marketing for colas. He is best known for his involvement with the youth-oriented 'Do the Dew' campaign for the Mountain Dew soft drink. Automotive Marketer Editor Kathy Jackson, Staff Reporter Julie Cantwell and Special Correspondent Laura Clark Geist spoke with Fraleigh on June 11.
What have the first months been like for you at GM?
I feel like I can make a positive impact. I would consider my first year or so here successful if we have significantly better advertising and allocation of our resources and big ideas.
What has been your No. 1 priority?
I've been personally involved in the Cadillac work. We need to get a signal to potential Cadillac consumers that this is a brand that's for you. It's not going to be straightforward feature/benefit advertising. You can't signal a fundamental change by just talking about features and benefits in the vehicle. The features and benefits are ultimately what is going to sell the product. But you don't create great advertising by trying to cram all those features and benefits in there.
Did you decide that Cadillac was going to be the priority or did someone else tell you that?
I'd say a combination of both. (GM General Manager for Vehicle Brand Marketing) John Middlebrook and (GM North America President) Ron Zarrella said, 'Look, we have put some processes in place that have helped to improve our advertising, but we think it can be taken to another level, and we want you to focus on that.'
You look at the importance of (Cadillac) to the company from a financial investment and being the premier division of General Motors. You get that right - the product and the advertising - and it pulls the whole entity along.
Where is GM's ad spending going?
I see our overall spending being relatively flat. I do see a shift from traditional national media to local initiatives. We are moving more dollars to local, but it's not going to be an endless flow. At the end of the day, most of national advertising is aimed at brand building. Most of our local advertising is aimed at moving vehicles.
Where are you with signing up the dealer ad groups?
We're at a little over 100. We've made a lot of progress. We had a national dealer council meeting last week (in early June), and we had positive response to it. They have suggestions in how to make the program better. We're happy with the progress that's been made.
Do you think GM's resources are adequate for effective marketing and advertising campaigns and are they used properly?
We have enough resources to make a significant impact of our brands on the marketplace. We have opportunities to better deploy those resources. In terms of what is the absolute right level and how you best deploy it, that's where the combination of research and how the people making the decisions use that research.
Do you think GM is doing a good job with the youth market?
I think there are definitely signs to appeal to youth at GM. And like anything else in this category, it's a combination of product and message. Both of those areas could stand improvement. A great example of product is the Pontiac Vibe coming out next year - definitely squarely hitting youth. The product and the message go hand and hand.
Are you considering a youth platform similar to what Toyota has done with Genesis and to what Ford and Chrysler are considering?
We've had several pockets of youth initiatives in the company. Coming in here, I think there's definitely opportunities to improve our youth advertising. No, I am not starting additional youth initiatives.
Should the media outlets be held more accountable?
It's great to hold people accountable, but the thing that you'd have to come up with is a kind of universal measurement system. It's a great concept but not the first thing I'd tackle.
Are you satisfied with the agency compensation agreement?
I would definitely see our agency agreements evolving, and, hopefully, our agencies would see that too. Ideally, I would want a system that is based on performance. I'm not approaching this as beat cost out of the agency because my first priority with the agencies is getting better creative. I've had talks with our agencies on this, and we'll probably start looking at this in '02. If we're really hurting as an industry or as a company, our agencies should feel some of that pain in terms of partnership. But if they're doing a great job and are in a down market, they shouldn't be held back from above-average compensation.
Isn't that what you have now in a compensation agreement?
Yes, today's compensation system is based on a number of factors that include marketing and advertising tracking things like (automotive research company) Allison-Fisher and other measures to how our total businesses perform. Do we see throwing all of that out? No, but I think our agencies should and can be held more accountable for their work.
Would there be more money on the table for your agencies under this new system?
Potentially, yes. But if you put more money on the table, you've got to put more money at risk.
Do you care who owns your agencies, whether Interpublic or some other media company?
The first consideration is who do we get the absolutely best work from. I do care. There are efficiencies and relationships that can benefit the work and help make that better. That said, if the right agency for a piece of business wasn't under a traditional house, we wouldn't hesitate about using someone from the outside.
Are any of your agencies in review or in trouble?
No. Some of them we're working to bring up to par or bring up to where they need to be.
Can you talk about the changes you've made to your ad processes?
We used to have about 12 people from agencies to brand teams to corporate advertising that used to work on legal issues. The quality of the creative could suffer because you just couldn't really get that good creative through because it just got watered down.
We're going to empower and demand that the ad director focus on being the primary point of contact on all legal matters for a division and that the divisional legal counsel and our legal department focus on all issues there.