IPG Gains In GM Reorganization

Interpublic Group of Cos. emerged the clear winner when General Motors unveiled its new field marketing strategy last week. The losers: Some 60 agencies with local ad assignments for GM’s Dealer Marketing Groups in 211 markets.
As of April 1, GM will stop funding the DMGs, eliminating the role of local shops. About $1 billion in spot media buying for GM lines handled by the regional agencies will be consolidated at IPG’s Local Communications unit. The consolidation will give the automaker “20-25 percent better cost efficiency,” said Phil Guarascio, the car maker’s general manager of advertising and corporate marketing. “And I’m confident our share of voice will not decline.”
The move mirrors GM’s consolidation of national media buying at IPG’s GM Mediaworks. As of April 1, creative for regional and local programs will also be handled by GM’s national creative shops: Ammirati Puris Lintas, Campbell-Ewald and McCann-Erickson (all IPG), and Leo Burnett and D’Arcy Masius Benton & Bowles.
Another IPG bonus: The establishment of R*Works, an agency to be housed in GM regional offices that will provide fully integrated, tactical event sponsorships and local promotions. R*Works (short for Regional Works) will “take the best of the best” talent from IPG agencies, Guarascio said. Employees at McCann-Erickson’s Momentum unit, which handles largely the same assignments, will be naturals for these positions, he added.
Dealer agencies will take varying billings hits when their ties to GM end in April, but most of those contacted said they saw the shift coming and had no choice but to find new business. Some, like J.W. Messner Advertising in Grand Rapids, Mich., said they will try to rebuild by taking on individual dealer accounts.