The auto show is under way in Detroit. But this year it's about far more than just having good-looking models and high mileage.
The auto industry faces an even bigger battle with perception. Their names, balance sheets and models have been dragged through the mud and now they have to figure out what kind of marketing approach will get cars off dealers' lots.
But now, just as the big three have to launch campaigns to regain customers' trust, the government is watching every dollar the big three spend. Bottom line: where and how the nation's automakers advertise is more important than ever.
I consulted with a number of advertising and branding experts about the auto makers situation and one thing is clear: they have to revolutionize the substance, style and execution of their old ad game.
And the old auto game was a powerful one—the release schedule for new cars in the fall is what created the network TV season, built around new auto ads. In the past auto ads were about showing how sleek and sporty cars are, how sexy they'd make you feel. Eric Dezenhall, CEO of Dezenhall Resources says now auto ads have to convince people that the cars are going to work and the companies are going to exist long enough to service the car they're trying to sell.
The ad formats now need to maximize bang for the buck. Publicis NY CEO Joe McCarthy tells me that companies that consistently advertised in the Super Bowl for the past two decades should really evaluate if it makes sense for them to now. In fact, in a congressional hearing for the automakers a few months ago GM CEO Rick Waggoner made a point to say that GM would not be advertising in the Super Bowl. Not only is it a question of whether it's worth it-- the companies now have to evaluate how good or bad their expenditures look to the public. Now, instead of pricey TV spots, the big three would be wise to try to target specific demographics and certain regions. The automakers would show consumers that they understand their needs if they speak to the bad weather in the Midwest or the need for good mileage in a commuter area.
One thing auto makers may be doing right, is their advertising focus on their capacity to finance auto sales. Dezenhall says that focusing on financing allows the auto makers to acknowledge the problem, and reassure, without going into too many details. Directly addressing the bailout in a 30-second spot or appealing to consumers to buy American through the recession could be a turnoff. But reassurance and a true understanding of how bad their image is, has to be part of every ad the auto industry makes.
And if one of the big three really innovates with their ad model (as well as their car models) this recession could actually offer a huge opportunity. In the great Depression Procter & Gambleincreased its advertising and grabbed a lot of marketshare.
We'll see if Ford, GM, or Chrysler can turn their ad model around fast enough to reassure consumers and capture their dollars once they're ready to spend.
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