Why Won't GM Go To The Super Bowl? It Doesn't Have The Money
Advertising Age, the industry rag read by Mad Men worldwide, found a simple reason for GM first unfriending Facebook, followed by a much bigger whopper, a “No thanks” to Super Bowl advertising. Ad Age says the decision is driven by the simple need to save money.
A while ago, we told you that there are two quick fixes if a car company wants to make its books look better: Cut marketing expenses, or cut R&D. Or, as in the case of GM, do both.
GM did cut about a quarter of the workers at its R&D facility at the Warren Technical Center in suburban Detroit.
Meanwhile on the marketing side, GM’s vhief marketing honcho Joel Ewanick “has been on a mission to wring $2 billion over five years out of marketing costs for the company’s flagship Chevrolet,” Ad Age says.
Ad Age also thinks that Ewanick is driving a hard bargain. Just like the Facebook announcement was timed to rain just a little bit onto Facebook’s IPO parade, the Super Bowl news was strategically placed at the start of the annual upfront marketplace, where ad buyers strike deals for commercial time in the coming TV season. CBS wanted to raise the price of a 2013 Super Bowl ad to $4 million, up from an average of $3.5 million for a 30-second spot NBC got this year.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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Is it just my prejudices, or does this simply conform to GM's real mission as a job creation rather than profit or value creation company?
Finally, GM and I have something in common. They won't be going to the Superbowl because they don't have any money--and I won't be going to the Superbowl for exactly the same reason. This is truly a sad day at GM. The party is over, in more ways than one. Where will all the hot-shot corporate marketing types, regional sales muck-kidy-mucks, gold-encrusted dealers and spray-tanned dealer wives go to escape the winter blues? The horror, the horror.
It would make sense if GM used the money to re-hire those R & D workers that they laid off/fired. GM NEEDS R & D more than most companies.
GM has over $30 Billion in cash and marketable securities, more than enough to buy many super bowl ADs. This decision is simply a business decision to discontinue AD expenditures which are not cost effective.