"There are no sacred lines in the budget," says GM Marketing Czar Joel Ewanick.
Baseball, hot dogs, apple pie and Chevrolet? That may have been the automaker’s mantra in the 1950s and ‘60s, but with six of every 10 Chevys now being sold in markets as far afield as Berlin and Beijing more and more of the maker’s marketing effort is focused overseas.
The latest move links Chevrolet with what is generally considered the world’s most popular soccer team – football to most of the world – Manchester United. The five-year partnership comes only weeks after Chevy’s parent General Motors confirmed it is pulling its ads off the 2013 Super Bowl.
Calling the tie-up with the British team a “natural synergy,” GM’s global marketing czar Joel Ewanick stressed that “Where they’re strong we want to grow. Where we’re strong they want to grow.”
The formal announcement of the Manchester United deal – along with a charity effort that will see GM fund the distribution of 1.5 million special, largely indestructible soccer balls to poor children around the world – came during a detailed discussion of the automaker’s rapidly changing global marketing strategy.
Since joining GM two years ago, Ewanick has shaken up the advertising world, ending decades-old relationships with ad agencies such as Chevy’s long-time partner Campbell-Ewald, and walking away from seemingly lucrative deals with the likes of the NFL.
During a Thursday morning news conference Ewanick explained his decision to pull GM out of the 2013 Super Bowl ad extravaganza by noting “It gets to the point it’s too expensive and you have to pull back.”
Ad rates reportedly will jump close to $4 million for a 30 second spot next February – up about 20% — even though the Super Bowl TV audience has been holding steady at just over 110 million. By comparison, Ewanick noted, a routine Manchester United game might deliver an audience of anywhere from 250 million to 400 million.
Football, or futball, as soccer is known to most of the world, claims an estimated 3.5 million self-described fans worldwide. By comparison, there are 400 million fans of the NFL. And teams like Manchester United have a surprisingly global appeal. The new deal, said the boyish-looking executive, should have particular significance in China, where GM is the number one manufacturer. As part of the new alliance, Chevrolet will sponsor the China Cup, pitting Manchester United against a major Shanghai team twice in the next season.
Could Chevy or GM’s other brands link up with other sports outside the U.S.? Ewanick suggested that is quite possible, noting that cricket has an estimated 2.5 billion global fans, field hockey about 2 billion.
The sports marketing initiatives are just a small part of a broader shift in GM marketing, and especially the strategy being put in place by Chevrolet, by far the maker’s largest brand.
“It’s all about efficiencies,” said Ewanick, in spending GM’s estimated $4.5 billion marketing budget. “Every penny counts,” he stressed, adding that, “If we allow any inefficiencies in anything we do it’s actually holding us back.”
That was the logic behind the maker’s decision to pull its ads off Facebook. If anything, GM research suggested they were being seen as “intrusive,” and not delivering a good return-on-investment, or ROI. But the maker isn’t abandoning the social media site entirely, Ewanick stressed. If anything, it will take its $10 million Facebook ad budget and divert it to developing content for the many GM Facebook pages, boosting that side of the budget to $40 million a year.
Asked by one reporter whether GM’s pull-out from the Super Bowl was somehow “anti-American,” Ewanick countered that Chevy has to accept it is a global brand, adding that “We haven’t done very well” compared to global competitors such as Toyota and Hyundai in appealing to potential buyers outside its home market.
“We’re not going to spend less in North America,” Ewanick insisted. “We’re going to spend more,” at least in terms of what consumers see in the way of GM ad campaigns. The total marketing budget isn’t necessarily going up, he cautioned, but by consolidating operations to improve back-end efficiencies, there will be more “consumer facing” dollars to spend.
Among the more significant moves Ewanick has taken, Chevy recently announced it would consolidate most of its global marketing efforts under a single newly-created entity dubbed Commonwealth.
But the reality is that for Chevy to succeed, it has to continue expanding sales in overseas markets, said Ewanick. “We’re going to spend more outside the U.S. We can’t just focus on Jefferson Avenue (the main street in downtown) Detroit. We need to also focus on Main Street in Shanghai.”
(GM will provide 1.5 million free soccer balls to needy children worldwide. Click Here for that story.)