LOS ANGELES Southern California Cadillac dealers are in the final stages of a review in which they are looking at local agencies to possibly replace the national tier-two shop, according to Andrew Sattley, head of the Southern California Dealer Association and general manager of a General Motors dealership in Oxnard, Calif. "We're exploring our options," Sattley said.
The finalists are undisclosed. National Cadillac and Pontiac tier-two advertising is currently handled by Martin-Jay Retail Group, Birmingham, Ala.
The move to review could be the start of a nationwide movement to hire local ad agencies or a resounding vote of approval for Martin. Though he did not acknowledge reviews in other parts of the country, Sattley predicted that GM dealers would likely settle somewhere between the extremes, with some hiring a local shop and others opting for the turnkey approach in which GM national continues to provide ads for their programs.
Sattley said about 20 RFIs were sent out and that the SCDA has narrowed the field to five, including Martin, which is defending its business. He said a dealer committee would meet in mid-March to determine whether to stay with the turnkey advertising from Martin or to hire a local shop. Local Marketing Associations have until April 1 to choose the turnkey approach or announce that they are hiring a local agency.
Last December, GM in Detroit said it had decided to break up the Local Marketing Groups (LMGs) for Chevrolet, Buick-Pontiac-GMC and Cadillac in favor of "voluntary, incorporated Local Marketing Associations."
GM said it wanted "to be more responsive to the changing landscape and to offer dealers the ability to become more effective in the way they manage advertising in their local markets."
At that time, GM said the program would allow dealer control over creative and agency selection, wherein dealers would work directly through their agencies, replacing a top-down approach in which GM would direct the regional advertising for distribution to the various LMGs. GM said it would permit LMAs to have control over media planning and purchasing, develop creative or modify creative assets created by the national program, and "better plan local promotions and sponsorships and other non-media activities."
A local program would be funded by the dealer groups themselves, typically based on a per-unit assessment, along with unspecified matching funds from GM national. Southern California Cadillac dealers, representing some 24 dealers, sell approximately 9,000 units per year.