DETROIT -- General Motors is completing new compensation agreements with its six advertising agencies. GM says the contracts tie agency performance bonuses more closely to the automaker's divisional sales and profits.
"The buzz in the business is return on marketing investment," says Brent Dewar, GM's vice president of North American marketing and advertising. "Am I getting an opinion change? Consideration change? Am I selling more cars? Am I getting more conquests or loyalty?
"That's how I direct my team members," Dewar told Automotive News. "My (ad agency) partners have to be in alignment with that."
The agreements judge all agencies on how well they balance creativity with containing production costs, especially for TV advertising, Dewar says. They also will reflect each GM division's satisfaction with the agency it works with.
In other instances, GM tailors the agreements to a division's goals. For example, the ad agencies that work with Saturn, Saab and Hummer have a higher percentage of their compensation tied to those brands' conquest rates, Dewar says. Other agencies' bonuses are linked to how well a brand retains customers.