With sales plummeting 16% this year, General Motors said last week it will attempt to cut $10 billion in costs per year. And one of the key areas set to take a hit is marketing.
That has Hollywood wondering how the ripple effect will hurt the biz.
Hardest hit will be sports sponsorships, with GM already having pulled out of the Masters golf tourney and opting not to renew its $1 billion contract to back the Olympics after this summer’s Games.
NASCAR, on which GM spends up to $140 million a year on sponsorships, promotions, advertising, and payments to teams and drivers, is also in the crosshairs. Some tracks have been told GM will pull the promo plug.
GM has long been one of the biggest ad buyers. It shelled out $2.1 billion on ads in 2007, according to TNS Media Intelligence, making it the fourth-largest advertiser that year. It spent $2.3 billion in 2006.
So TV will also feel the effects. Last year, GM spent 11% less on TV spots, according to TNS.
But GM will still be a big spender for years to come; analysts expect it to focus heavily on pushing its Chevrolet and Cadillac brands vs. its Buick, Hummer, Pontiac, GMC, Saturn and Saab monikers, especially when it comes to new vehicle launches and overall branding.
GM traditionally spends big around the Oscars. And after a successful placement of its vehicles in “Transformers” last summer, the company will be back next year for the sequel, with its cars and trucks once again starring as the heroic shape-shifting robots.