When GM Shifts 1.5 Billion From Traditional Advertising To Digital Marketing…

Posted by

Does it mean that General Motors is trying to get more bang for their advertising buck in a time of recession, or that the Advertising and Marketing world better really perk up and pay attention, because GM is the third largest advertiser in the United States?

It was the Digital Marketing shot heard around the world today.

General Motors will take half of its three billion dollar advertising budget and shift 1.5 billion of it to Digital Marketing initiatives. You can read more about it over at Media Buyer Planner in their news item, GM Changes Game, Puts $1.5 Billion Online.

"The news is not good for traditional media and may be exacerbated by a directive from GM’s Brent Dewar, VP – Field Sales, Service and Parts in North America. Dewar told Ad Age late last year that the auto maker will try to persuade its regional dealer ad groups ‘to shift their focus to digital vs. spot TV’ starting this spring after the dealer co-ops, which spend $500 million annually, are revamped… Other car makers are also upping online buys; Hyundai will double its online spending in 2008 over 2007."

And, in what could be the most telling shift in how we perceive the online space and her ability to convert even "lookers" into "buyers" on big-ticket items:

"…while television and print still have a place in product launches and awareness, many dealers now accept that the purchase process starts – and sometimes ends – online."

Maybe it’s not the economy (or maybe it is a part of it). Just this week, I had a Blog posting titled, Teaching Marketing Is Getting Tougher And Tougher, over at the Canadian Marketing Blog, where I said:

"While Marketing is never recession proof (usually the exact opposite), when dollars do get pulled, it’s looking like they are getting shifted to cheaper and more strategic channels (like Search Engine Marketing and Email programs) than being entirely yanked from the Marketing line of business."

That Blog posting stirred Dan Dickson to comment:

"I’m not sure I agree… My experience has been that, in a crunch, marketers run back to what they’ve always known, and steer away from newer, ‘riskier’ efforts like search or email, let alone social media. I know it sounds odd to you and I that search and email are considered new and scary, but there are lots of people out there who still think print and radio are the safe havens of marketing and, faced with a crunch, will scale back everything but those."

All of this comes as MarketingVox reports in a news item titled, SEM Spend To Grow As Marketers Shift Budgets Amid Economic Concerns, that:

"’The spending statistics show search engine marketing continues to prove its worth in the larger marketing arena. However, in light of the concerns about the overall economy, it’s important to note some of this spending is the result of shifting marketing dollars from other offline and online marketing endeavors,’ said Jeffrey Pruitt, SEMPO president, and EVP of corporate partnerships at iCrossing."

Is this the Perfect Digital Marketing Storm? We have one of the biggest advertisers shifting half of everything they’ll do to the Digital Marketing channel, while those struggling to get the most of every Marketing dollar in a time of recession are also moving towards more ROI-driven ad models (like Search Engine Marketing).


  1. GM has simply decided that the return on investment is higher in digital advertising. Who knows if they are right.
    One thing is certain, promoting products online in digital media, whether it is cars or moving, is more measurable than anything they can do in print or on TV, and this is probably what is driving this decision.
    GM wants to know that every dollar spent is buying interaction with a customer, not just some elusive branding halo.

  2. Haha it’s interesting to see how this may have been a shot heard round the world, but nowadays you’d be crazy not to invest in digital marketing. This article is only 3 years old!

Comments are closed.