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News and Industry Features
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Analyst: Local TV auto ads to rebound next year
Although headlines about the U.S. car industry have sounded dire, Sanford C. Bernstein analyst Michael Nathanson says that because consumer demand for new autos "has rarely been this weak, at some point in 2010, it will strengthen." That rebound will strengthen local ad markets, "most notably local TV stations," he says, MediaPost reports. Based on his research, Nathanson increased his fiscal-year 2010 earnings-per-share estimates on CBS Corp., Walt Disney and News Corp. and his price targets across sector stocks. He even upgraded CBS shares to "market perform," according to the publication, which cited a Hollywood Reporter story. Auto ads declined 17% in 2008, with TV stations seeing an outsized 33% drop. 2009 is likely to be an even worse year for auto advertising after a 29% decline in the first quarter. But 2010 could be different. "The dealership closures by the Detroit automakers sounds disastrous for local advertising, but we believe the 2010 impact will be less severe." Local dealer ad budgets have been relatively small and the shuttered dealers are the weakest. Overall, auto ads will boom in 2010 to serve pent-up demand, he concludes, and "local TV stations will be a big beneficiary of the increased spending."
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Kelley: More new-car shoppers see gas prices skyrocketing
When asked in May 2009 what they think will happen with gas prices in the next 30 days, 87 percent of new-car shoppers said they thought gas prices would go much higher, a significant jump from the 66 percent who thought gas prices would increase just a month earlier, Kelley Blue Book said Tuesday. The information was gleaned from the latest Kelley Blue Book Market Intelligence survey of in-market new-car shoppers on kbb.com, detailing consumers' opinions on gas prices and how they affect their purchase decisions
[FULL STORY]
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Who’s 'twittering'? Volvo, for one
Twitter is the media darling du present, notes a columnist on ClickZ.com. But how does Twitter, which is an ad-free platform, factor into a discussion about online media planning? And who's doing it? The automotive category has gotten in early on the Twitter advertising act. Both Land Rover and Volvo have executed campaigns, though very differently. Using Twittads, Land Rover ran a campaign in May 2009 to promote the debut of its newest vehicles at the New York International Auto Show. Volvo took a different tact. Its ad was a 950x250 rich media YouTube banner ad that incorporated live tweets from the VolvoXC60 Twitter account to promote its new XC60 model. Volvo then used the Twitter account to provide live updates during the same New York auto show -- the result was really two ads in one. Click the link for more.
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Ex-VP of marketing says GM needs more passion
Michael Jackson was hired by General Motors in 2000. In 2006, he was made the VP of marketing and advertising. Less than a year later, he retired. In a recent column in Automotive News, he wrote a commentary calling on the bankrupt automaker to "overhaul marketing," saying "GM needs passion and creativity – not incentives." Now, in an interview with Advertising Age, he says that GM's bureaucracy doused the fire of innovation.His specific indictments were that "U.S. operations have too many layers for approval of ads," that GM is a "bureaucracy of meetings culture," that GM put "engineers and finance people with no marketing training in key marketing positions," and that GM doesn't "treat its ad agencies like partners but rather as vendors. If an agency doesn't fall in line with the marketer's demands, the client threatens to move the business." That turned agencies into factory stampers that would "present work they know will get approved, not cool, risky creative."
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Toyota stars in 'community-generated TV program'
Gas Station TV
Gas Station TV and Toyota Motor Sales, U.S.A., Inc., Monday announced the launch of "Prius Neighborhood," which they called a first-of-its-kind TV program on Gas Station TV. The community relations program broadcasts consumer-generated local events and cause listings on at-the-pump screens while promoting the new 2010 third-generation Prius. "Prius Neighborhood" started airing Monday.
[FULL STORY]
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GM asks survivors to help block bill to protect targeted dealers
General Motors Corp. is urging its dealers to speak out against Congress' efforts to block the Detroit automaker from closing at least 1,330 U.S. dealerships, The Detroit News reports. Mark LaNeve, GM's vice president for North American sales, service and marketing, sent a letter Friday to GM dealers not on its hit list, asking them to fight efforts in Congress to overturn plans by GM and Chrysler Group LLC to shutter hundreds of sales outlets. Chrysler closed 789 of its nearly 3,200 dealers a week ago, after a bankruptcy judge approved the downsizing move. GM wants to pare back its nearly 6,100 dealers to between 3,500 and 3,800 by the end of next year. It expects 1,280 will close their doors voluntarily and is seeking court permission to close about 1,330 -- though GM has reversed decisions in 45 instances. A bill in Congress introduced June 8 to "restore the economic rights of dealers" now has 111 co-sponsors.
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Edifice Group launches 'no cost' marketing for auto dealers
The Edifice Group, a specialty advertising agency offering multichannel marketing solutions to the nation’s auto dealers, has launched a new Web site offering what it calls performance‐based “no cost” promotional solutions. Edifice said it absorbs
all marketing costs for e-mail, postal, telemarketing, SEO and Web advertising, while dealers only pay on a CPA structure, per cars sold during the campaign.
[FULL STORY]
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Microsoft suit targets 'click fraud'
Microsoft Corp. has filed a lawsuit against three people that it alleges committed a form of "click fraud" by improperly manipulating Microsoft's online advertising service for profit, the Wall Street Journal reported Tuesday. Microsoft of Redmond, Wash., filed the suit in federal court in Seattle on Monday against three people and several corporations under their control. The suit seeks at least $750,000 in damages for an alleged scheme last year to drive up advertising costs for legitimate Microsoft advertisers while creating an advantage for the defendants' own businesses. Microsoft's complaint alleges that three defendants in Vancouver, B.C. -- Eric Lam, his mother Melanie Suen and his brother Gordon Lam -- made more than $250,000 in profits through the scheme. Reached by phone, Gordon Lam said he wasn't aware of any lawsuit by Microsoft and refused to answer further questions. Eric Lam and Melanie Suen couldn't be reached for comment. Microsoft said it's taking the action to crack down on click fraud, in which automated computer scripts or large groups of people click on online advertisements without having any interest in the services or product being advertised.
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Collective Media taps Yahoo! vet to lead Detroit office
Collective Media, a provider of media and technology solutions for online publishers, agencies and advertisers, said it deepened its expertise in the automotive online advertising sector with the addition of Brian Elliott as Director, Automotive Category. Elliott, 40, who previously served as the Director of Yahoo!'s Automotive Category, will lead Collective Media's Detroit office, overseeing sales operations and client management of the firm's premier automotive clients.
[FULL STORY]
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Advertising
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Research increases return on investment
by Jim Boldebook
There was a time when ‘throwing your advertising budget dollars against the wall’ might yield a reasonable .jpg?i=062209115734) return on investment. Newspaper was a powerful information format for potential shoppers. Electronic media was reasonably priced. Postal rates and paper were fairly cheap so that targeted direct-mail programs would often generate a high percentage of shoppers at an attractive cost per thousand. Even with 20 to 30 percent of ad budgets spent ineffectively, it was still common to hear of dealers spending less than $100 per vehicle on advertising: often less than 8 percent of gross. Research was rarely discussed. Welcome to the 21st century and the reign of ‘communication confusion’ as dealers facing lower grosses, both on the front and back end, as well as a proliferation of media opportunities and challenges attempt to distribute advertising dollars in a cost-efficient, effective manner. Read More
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ARCHIVE
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June 10, 2009
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