Bailed-Out GM Fumbling with Marketing Themes
The weakness of General Motor's management team regarding one of the most basic concepts of car sales has surfaced as the company tries to learn how to effectively market its vehicles. An article on thespec.com points out that GM's "Chevy Runs Deep" ad campaign has not resonated well with consumers. No big surprise there. Management, led by an Obama appointed non-car guy, CEO Dan Akerson, continues to try and sell cars through the use of ineffective ads that focus on patriotism and politically driven themes as opposed to focusing on specific product offerings.
According to the piece, the "Chevy Runs Deep" campaign has not boosted showroom traffic and data from Edmunds.com confirms that the ads have done little to boost consumer shopping for Chevy. Considering that GM has an annual ad budget of about $4 billion, the taxpayer supplied funds are not being spent wisely. While it may buy some favorable coverage from TV news networks regarding GM's actions, the money spent advertising is not giving an impressive return for the investment.
Akerson has displayed little understanding of the car business. Of course, Akerson is not solely responsible for ad themes, but he does bear ultimate responsibility. Early on in his tenure, Akerson made statements that he wanted to use humor in GM ads to sell vehicles. He followed this with claims that the Chevy Volt and China sales would be the drivers of GM profitability. GM even went so far as to have the term "range anxiety" trademarked for use in its ads. None of Akerson's proclamations are panning out, and the range anxiety approach has led more to credibility anxiety than it has to Chevy Volt sales.
We now can turn to GM's latest display of misguided marketing themes. The idea that consumers would buy a car from a bailed out company based on feelings of patriotism because the brand "runs deep" is laughable, or at least would be if taxpayers weren't losing so much money. Add to this the hypocrisy displayed by GM referencing a long history for Chevy as they use its bankruptcy proceeding to relieve itself of liabilities from defective vehicles, like the Chevy Impala, because the vehicles were manufactured by "old" GM and the current GM is a "new" company. I really don't think most Americans feel that GM is the picture of patriotism after taking billions of taxpayer dollars to restructure. Besides, what the heck does Chevy running deep actually mean?
Next up is Akerson's latest brainstorm. SpikeDDB, GM's "black ad agency", created another spot called "Table of Brotherhood." This latest campaign revolves around people of different ethnicities listening to a Martin Luther King, Jr. speech. Akerson feels this is a powerful message and wants to use it "extensively." The guy does not seem to be learning on the job as he continues to miss the basic premise of the car business.
I offer up this advice to GM. Forget the politics! Unprofitable green vehicles, praising racial harmony and expecting American consumers who were bilked of billions of dollars to bail out GM to then support the company because they are patriotic will not drive sales. Car sales are emotionally driven and offerings of exciting vehicles that offer value over competitors will be the main path to profits. GM will have a hard time completing its turn around if they can not learn these simple facts. In a nutshell, stop acting like Government Motors and return to the basics.
Mark Modica is an NLPC Associate Fellow.