How about ad agency reviews for all GM’s brands?

Most of the creative from all these shops is beyond bland and boring, it's simply bad advertising.

Nothing can cause serious pain, head-aches, anxiety attacks, depression or melancholia than news the ad agency you work for on the such-and-such brand is going into review. But it’s never been a problem in Detroit with GM’s shops. 

Well, Phil Gurascio did shake things up when he ordered cuts in the 15% commission GM was paying its agencies, a drop to 9%, when he first joined GM and then hired a couple creative boutiques, but that was long ago.

Until recently GM’s agencies were literally revered, recognized and respected as brand partners. Reviews? Hah! Sacrosanct maybe, but reviewed … never!  Who would know what to do and when?

Both agencies and the big budget GM brands took great pride in noting, protecting and honoring decade’s long relationships, some going back to the 1920’s.

No Agency Review Required!

Yet, the financial debris which resulted from the approval of the GM’s Chapter 11 bankruptcy in Federal Court that summarily dismissed, disregarded, ignored, forgot and overlooked untold billions of debt  obligations to bondholders, stockholders, retirees and suppliers … everyone except GM’s advertising agencies, which were needed by the new company.

GM’s agencies got a “go past home” free pass. They got paid most, if not all of the monies owed to them and kept the business too.  Chevy is still a Campbell-Ewald where it’s been since the 1920’s. Pontiac is still with Leo Burnett, which in previous iterations was MJ&A, DMB&B and Chemistri and at one time handled Cadillac, Pontiac, Mr. Goodwrench and GM corporate accounts. McCann retains Buick, well sort of.

Most of the creative from all these shops is beyond bland and boring, it’s simply bad advertising. Getting it sold to the client is not and never will be the measure of good advertising Yeah, I know an agency is only as good as the client lets it be. But after so many years who is and was the responsible custodian of the old brand? The agency that’s who. They don’t get a pass from me on this.

Where were the breakthrough marketing concepts that have propelled relatively small advertisers to great success?  Brands like Hyundai, Mini and VW grew and have grown with new ideas and concepts from their agencies — some without big car experience — that resonated with consumer response. And wouldn’t that be nice for Chevy, Cadillac, GMC and Buick?

As a former agency suit I have felt the pangs and pain of client reviews; nevertheless, I urge Bob Lutz to institute a review of all ad agencies handling the brand’s he is now responsible for rebuilding. Check out some new agencies. To do what he did at BMW, seek the best and brightest, He’ll need then to set the proper stage for the revitalizing the old GM brands.  Why top off bad results with more of the same? 

Q&A: Toyota’s Bob Carter talks about Cash for Clunkers  

I had the opportunity a recently to sit with Bob Carter, the group vice president and general manager of the Toyota Motor Sales and chat about many topics. One of the most important areas we discussed, given today’s date, July 24, 2009, was the governments emerging CARS program, aka “cash for clunkers.’ 

MB: How big do you think the new cash for clunkers program will be?

BC: It’s an unknown area for us right now.  We are very supportive of it. We are supportive of anything that helps improve the industry. There’s some independent research out there that says on a rolling twelve month basis this could be anywhere from 250,000 units incrementally. Other research says as much as one million units could be added. 

MB: Realistically, where do you believe it will fall?

BC: We are a little bit more on the lower end of that forecast. But when you have every manufacturer participating in and rallied around one idea the combined marketing efforts of all manufacturers is going to provide some incremental lift to the industry.  Still, it’s difficult to forecast. Overall it will provide an overall lift and some improvement in consumer confidence and take old units off the road.     

MB: What impact could the program have on the industry?  

BC: On the short term, we think it’s going to push the market in total volume to over a million units for the month of August for the first time in 8 or 9 months,  and its been sometime since that much volume. On a SAAR basis, when you put the million units on, it could mean an industry of 10.6 million range. It gets us headed in the right way. 

MB: Germany’s program has been well received, but it is much simpler than the U.S. version when official rules are promulgated on July 24, could that hurt?

BC: It has and I’m very encouraged about from the reports we get from our sister divisions in Europe. In Germany they’ve seen a spike in business to the tune of 30%, the UK just announced their program they are seeing a lift of in excess of 20%. (the UK program required a match form makers) The U.S. program is a little different – it’s a scrappage program as a stimulating element. Also has an environmental element.  

MB: There have been some negatives though, haven’t there?

BC: One of the challenges dealers have faced in some countries where this program has been introduced is cash flow to the dealers. Government payments to the dealers have not come through as quickly as it needs to be. 

MB: Given the current economy, cash flow is the life blood of a company, so that has to be a dealer concern in the U.S., right?

BC: It has heightened awareness. The bill stipulates that the dealer(s) receive payments (cash flow) within ten days of the transaction. Toyota, as are other manufacturers, is working on programs to help their dealers with the cash flow through our finance company.  

MB: There is much to be done to educate the consumers of the essential rules and regulations, what has Toyota done in this area? 

BC: You’re right. I believe there’s going to be some heavy lifting to help educate our dealer sales force and help educate the consumer on how this bill applies to them. We are working on that now.  A consumer can go to Toyota.com and click to the special section  then use the special calculator to learn the amount their car qualifies for ($3,500 to $4,500) based on regulations as we now understand them. If it’s a truck it becomes much more difficult. But overall it eliminates work for the consumer and says, “If you have this, it is eligible for cars assistance of this amount on these products. We are attempting to take the work out for the consumer. 

MB: There are mistaken beliefs regarding trade-ins aren’t there?

BC: Yes, there are some misperceptions out there. Some consumes come in and believe if I trade my car I get trade in value plus $4,500. This is incorrect. There’s a lot of education that still needs to be done but until all the rules and regulations are published we are putting out there what we know is fact. 

MB: So it’s all pending till official rules come out …

BC: Yes, but once the 24th comes there’s much work that still must be done.  Anything that gives the consumer a little more confidence and gets them back into our dealerships is all good.  

CARS Official Rules

Here’s government bureaucracy at work. The official rules of 49 CFR Parts 512 and 599

[Docket No. NHTSA-2009-0120 ] RIN 2127-AK53, also known as the cash for clunkers or Cash Allowance Rebate System (nice acronym)  program can be found by clicking here.  Put on your reading glasses, this beauty is 136 pages long. 

There are a few misconceptions about what is eligible and for much (see previous Carter interview) Following is the Top Ten Myths of CARS as developed by  the American International Automobile  Dealers Association: 

Myth: Dealers can start participating in the CARS program July 1.
Fact: While the law states that the program begins on July 1, it also states that the National Highway Transportation Safety Administration has 30 days from when the President signed the bill to finalize the rules of the program. So, in reality, the government has until July 24 to develop and finalize CARS rules. Dealers transacting CARS-type transactions before then risk violating the rules and could lose $3,500, $4,500, or face up to a $15,000 fine. That risk to reward ratio is too high. I suggest dealers wait until the rules are finalized to offer vouchers. Once dealer registration for the program is open, dealers can register to participate, and can count on receiving electronic reimbursement from NHTSA for the vouchers. 

Myth: Consumers will receive their car’s trade-in value PLUS a CARS program voucher of up to $4,500.
Fact: The vouchers are offered in place of a trade-in value since the car must be scrapped. So if a car is worth more than $4,500, its owner has no reason to participate. Thus, the ‘clunkers’ aspect of the program. In addition, a dealer must disclose the scrap value of the vehicle to the customer. 

Myth: All new cars and light trucks are eligible to be part of the program.

Fact: The program only applies to customers buying new vehicles that meet the program’s mileage standards and have MSRPs of $45,000 or below.

Myth: Consumers can apply a voucher to a lease.
Fact: Not really. The program applies only to leases of 60 months or more, which are, let’s just say, rare. 

Myth: Trade-ins have to be at least 8 years old to be eligible for the program.
Fact: There is no age requirement on the cars being scrapped. As long as the vehicle is not more than 25 years old, and is rated at getting less than 18 mpg city and highway combined, it is eligible. Check mileage ratings here.

Myth: Consumers can buy a $500 junker and trade it in the next day to get a voucher for a new vehicle.
Fact: Don’t try to outsmart Uncle Sam. The clunker must be in drivable condition, and registered and appropriately insured to the same person for at least one full year preceding trade-in.

Myth: The program only applies to the first 1 million cars.
Fact: The CARS program is funded with $1 billion, and will continue until the money runs out, or we reach the planned end date of November 1.

Myth: Dealers can register to participate in the program on a variety of websites.
Fact:  Dealers must register for the program but registration is not yet open.  According to the government, it should be up and running by July 23.  Be wary of any website other than the official government website www.cars.gov. 

Myth: The CARS program  applies only to vehicles built in the United States.
Fact: All brands, international and domestic, are eligible for participation. 

Myth: The CARS voucher replaces manufacturer rebates and discounts, and other government incentives.
Fact: The voucher can be used in addition to other discounts and factory rebates. So, for example, a consumer can use their voucher along with a hybrid vehicle credit and manufacturer rebate to buy a new fuel-sipper. 

Recapping the basic requirements:

And for retailers here’s the link to a checklist of basic steps to qualify and certify your dealership for the program.

Tiger Woods: Classy, just plain classy!

Last November, as the gray clouds of impending disaster shrouded the GM headquarters, the Buick Division announced it was severing the long time, 9 years and counting, endorsement, sponsorship relationship it had with Tiger Woods, the best known athlete on the planet.

It had been a good deal for both. Tiger made millions in endorsement fees and matching dollars for television appearances, the Buick logo was emblazoned on the golf bag. In return Buick had a recognized charismatic spokesperson, who while out of their demographic customers, average age above 70, brought prominence to the lagging brand and to its five decades long pro golf tournament, The Buick Open, played up I75 in Grand Blanc at Warwick Hills.

Would the tournament continue? And impossibly, would Tiger leave the major tournament schedule he has followed since knee surgery, to play in his former sponsor’s tournament, and maybe its last? 

Yesterday Tiger Woods announced he would play the Buick Open this year. A man who has made millions in endorsements and appearance fees is returning to the Flint area. Local charities, which benefit from the event, become winners with over $5 million in contributions. The Buick brand becomes a big winner.  But the biggest winner, in my mind, is Tiger Woods — a man of integrity and class, who can serve as a role model in professional sports and business too. Classy, just plain classy!  Take a look at a Tiger Woods commercial being shot by clicking here.