By Helen Sloan
June 06 2012
When General Motors pulled its advertising from Facebook last month, much of the comment initially focused on the impact on the social network’s imminent IPO. Then the auto company announced that it would not be advertising in the next Super Bowl; a notable change of tack for a brand that has been one of the game’s biggest advertisers in recent years. Developments since then have confirmed that GM is, in fact, undergoing a significant recalibration of its marketing strategy towards a more global audience.
The company has now revealed where they will be spending their marketing money instead – and it’s not in America. GM announced that Chevrolet, one of its biggest brands and a car with 100 years of history, was entering into a five-year partnership with Manchester United and will become the English club’s official automotive partner. "As Chevrolet continues to grow as a global brand, this is the right time to make a commitment and establish a presence in international football," Joel Ewanick, GM’s chief marketing officer said of the move. He is on a mission to reduce GM’s marketing budget by US$2 billion, but it seems that he has more in mind than cost-cutting. The deal marks a significant repositioning for General Motors: for while Manchester United may be the biggest football team, and one of the biggest brands, on the planet, soccer does not have quite the same status in the US (David Beckham was famously refused a cameo in The Simpsons as he was not famous enough).
Also interesting is the fact that the announcement was made in Shanghai: part of the deal involves a new tournament called the Chevrolet China Cup which will see Manchester United play against local Chinese teams. The Chevrolet sells in relatively small numbers in China when compared to the US, but, crucially, the numbers are growing fast: it seems clear that this is the market where GM wants to be.
Dennis Prahl from Ladas & Parry in New York believes that this could be a very wise move for GM. “Their traditional markets are being exhausted and they need to focus on global outreach to survive,” he says. “Teaming up with the world's largest soccer brand is a fantastic way to do that, particularly with the economic situation in North America and Europe and the increasing economic might of, say, China, Brazil and others. It could even assist their outreach in the US where the demographics are quickly changing to include more soccer fans as time goes along. Any American brand which wants to survive needs to rethink how to reach developing markets.”
Chevrolet is a brand that is very strongly associated with the US, however Prahl does not believe that GM’s global plans will have a detrimental effect on the home market. “I don’t think there is a serious risk of diluting the strength of the Chevrolet brand so long as GM continues to make quality products at competitive prices and the quality is consistent from country to country or region to region,” he says. “McDonalds and Coca-Cola don't seem to have suffered from the approach. As long as GM doesn't forget about their origins, continues to pay attention to their core markets as well as their developing markets and does not sacrifice product quality, they should be well situated”.
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