DETROIT -- General Motors' decision to put its U.S. media-buying account into review could be the first step of a marketing shakeup, industry analysts speculate.
GM spent roughly $2.51 billion last year to advertise in major U.S. media, according to TNS Media Intelligence. That figure includes national and local advertising in broadcast, print and nontraditional media.
The 2004 figure is 18.2 percent higher than the $2.12 billion spent in 2003, according to TNS.
CFO John Devine says GM will spend more this year on advertising, especially on vehicle launches, but he did not give a figure.
Analysts say GM seeks to improve the efficiency of its advertising and marketing spending in the wake of declining U.S. sales and financial problems. GM said last week it expected to report a loss of almost $1 billion for the past six months.
GM Mediaworks of Warren, Mich., a unit of Interpublic Group of Companies of New York, handles GM's media buying. GM says it is reviewing the Mediaworks account because it seeks "a more streamlined and efficient unit, with greater focus on innovative, strategic media buying." GM says it expects the review to take about two months.
"We are reviewing the business as a matter of making sure we are competitive in the fast-changing media landscape," says Mark LaNeve, GM's vice president of North American vehicle sales, service and marketing.
"Mediaworks has been a very valuable and capable partner," he says. "We would be very comfortable continuing with them if they win the business in review."
Interpublic said last week it believes it can "mount a successful defense" of its work during the GM review. Mediaworks executives did not return phone calls.
The GM media-buying account brings as much as $50 million in annual revenue to Interpublic, according to Advertising Age, a sister publication of Automotive News.