UPFRONT 1997: Automotive

Brand appeal replaces sex appeal as automakers look to push new models out of showrooms

Gentlemen, start your engines: With a strong economy and a greater emphasis on brand management, car companies are putting more money into national image advertising. At the same time, however, more automakers have gotten hold of the retail budgets that are partially funded by dealers, enabling them to “move the metal” when they need to without necessarily resorting to tired “Deal-athon” advertising.

There is still considerable money being pumped into the sport utility segment, with new models forthcoming from Lincoln, Mercedes-Benz, Subaru and Dodge. Analysts say Ford’s Expedition, introduced last fall, and the Lincoln Navigator, coming this fall, will be rocking the category much as the Explorer did when it launched in 1991.

The light truck segment, where profits are also extremely high, is getting a dose of new products from Ford, Mazda and Nissan, all of whom have a big stake in successful launches.

General Motors has several new cars that are hitting the showrooms this year, too, including three minivans and sedans in the Olds, Buick and Pontiac divisions. Cadillac is struggling with its Catera sedan. The car that “zigs” is supposed to solve Caddy’s long-standing problem of being passed over by baby boomers, but has met a cool reception since being introduced in the fall-so cool that rumors of a re-launch have been swirling, possibly meaning greater dollars going into younger-skewing magazines and TV programming later in the year. Oldsmobile is spending heavily on image advertising this year, about $120 million, compared to almost all retail advertising last year.

Another source of new money will be coming from Korean car maker Daewoo, which is reentering the U.S. market in the fall or spring of 1998. Daewoo is looking for four regional ad agencies to handle its marketing programs. Rather than relying on dealerships, the car maker expects to sell through mass retailers like Wal-Mart, superstores and warehouse stores, and service the cars through chain stores like Pep Boys. Chrysler is introducing its refurbished large sedans in the fall, and will be spending heavily on national advertising to get them off the ground. -David Kiley


*Sport utility vehicles remain white-hot

*Dealers shift spending into overdrive

*Ford, Mazda, Nissan to break new campaigns for new compact pickups

OVERALL: Spending up moderately

DARK HORSE: If economy falters, national brand spending may give way to more retail spots

Copyright ASM Communications, Inc. (1997) ALL RIGHTS RESERVED