By Andrew McMains and Noreen O'Leary of Adweek
General Motors' move to file for bankruptcy protection Monday—the
troubled automaker claims $82.3 billion in assets and nearly $173
billion in debts—will have a far-ranging impact on the global
agency and marketing landscape, which has grown to depend on the
Detroit giant for voluminous expenditures in measured media and
promotions of every kind.
Not just automotive photographers, but all photographers who shoot
for ad-supported media, are likely to feel the impact.
GM plans to launch a new streamlined operation in 60 to 90 days,
after the U.S. government converts about $50 million in loans to
the carmaker into a 60 percent equity stake.
Among GM's creditors, per the filing, Starcom MediaVest ranks sixth
largest with $121.5 million; with its parent Publicis Groupe owed
an additional $25 million-plus; and Interpublic Group on the hook
for $16 million. (Visit the
GMCourtDocs site for more
information.)
The ultimate shakeout of nameplates and future brand spending in
media has yet to be determined. For each of the past three years,
the company's overall global marketing expenditures have topped $5
billion. U.S. ad spending in 2008 was $2.1 billion, per
Nielsen.
Beyond attempting to recoup cash already owed, a slash in GM
marketing spending would have significant impact on agencies within
IPG and Publicis—the two ad holding companies that handle the bulk
of the carmaker's business. GM is IPG's number one worldwide
client, supplying an estimated 5 percent of the $6.9 billion
company's revenue last year. The percentage of revenue that GM
provides to Publicis could not be ascertained but the holding
company has told analysts that all its automotive business (which
besides GM, includes Toyota and Fiat) represents 13 percent of its
worldwide revenue, which totaled $6.1 billion last year.
Apart from media planning and buying duties at SMG, other key
Publicis shops that work for GM include: Leo Burnett (creative
duties on Buick, GMC, Pontiac) and Digitas (digital marketing), and
those within IPG include Campbell-Ewald (Chevrolet creative duties,
some customer relationship management duties), McCann Erickson
(creative duties on Saab, corporate image efforts), Mullen
(creative duties on GM credit cards, some CRM duties) and
Deutsch/LA (Saturn creative duties).
An IPG rep on Monday issued this statement: "We have been very
direct in identifying and addressing the potential implications
this decision could have on our business. Far more important is
that today marks an important step toward a strong and vital GM and
that we look forward to playing our part in that future
success."
GM also uses independent Modernista! for creative duties on both
Cadillac and Hummer, which like Saturn and Pontiac, GM is looking
to sell. The U.S. government has suggested that GM sell GMC as
well.
Additional coverage from Adweek.
GM Filing Echoes Through Media World
June 2, 2009
By Andrew McMains and Noreen O'Leary of Adweek
General Motors' move to file for bankruptcy protection Monday—the troubled automaker claims $82.3 billion in assets and nearly $173 billion in debts—will have a far-ranging impact on the global agency and marketing landscape, which has grown to depend on the Detroit giant for voluminous expenditures in measured media and promotions of every kind.
Not just automotive photographers, but all photographers who shoot for ad-supported media, are likely to feel the impact.
GM plans to launch a new streamlined operation in 60 to 90 days, after the U.S. government converts about $50 million in loans to the carmaker into a 60 percent equity stake.
Among GM's creditors, per the filing, Starcom MediaVest ranks sixth largest with $121.5 million; with its parent Publicis Groupe owed an additional $25 million-plus; and Interpublic Group on the hook for $16 million. (Visit the
GMCourtDocs site for more information.)
The ultimate shakeout of nameplates and future brand spending in media has yet to be determined. For each of the past three years, the company's overall global marketing expenditures have topped $5 billion. U.S. ad spending in 2008 was $2.1 billion, per Nielsen.
Beyond attempting to recoup cash already owed, a slash in GM marketing spending would have significant impact on agencies within IPG and Publicis—the two ad holding companies that handle the bulk of the carmaker's business. GM is IPG's number one worldwide client, supplying an estimated 5 percent of the $6.9 billion company's revenue last year. The percentage of revenue that GM provides to Publicis could not be ascertained but the holding company has told analysts that all its automotive business (which besides GM, includes Toyota and Fiat) represents 13 percent of its worldwide revenue, which totaled $6.1 billion last year.
Apart from media planning and buying duties at SMG, other key Publicis shops that work for GM include: Leo Burnett (creative duties on Buick, GMC, Pontiac) and Digitas (digital marketing), and those within IPG include Campbell-Ewald (Chevrolet creative duties, some customer relationship management duties), McCann Erickson (creative duties on Saab, corporate image efforts), Mullen (creative duties on GM credit cards, some CRM duties) and Deutsch/LA (Saturn creative duties).
An IPG rep on Monday issued this statement: "We have been very direct in identifying and addressing the potential implications this decision could have on our business. Far more important is that today marks an important step toward a strong and vital GM and that we look forward to playing our part in that future success."
GM also uses independent Modernista! for creative duties on both Cadillac and Hummer, which like Saturn and Pontiac, GM is looking to sell. The U.S. government has suggested that GM sell GMC as well.
Additional coverage from Adweek.
