Are car advertisers wasting money?

As car manufacturers continue to throw huge amounts of money at their brands, Robert Dwek wonders if some would be wiser to consider the quality of their ads

As car manufacturers continue to throw huge amounts of money at their

brands, Robert Dwek wonders if some would be wiser to consider the

quality of their ads

Last year, 46 car manufacturers spent pounds 500 million on 487

campaigns. They parked their advertisements on 15,830 press pages and

motor-mouthed their way through about 3,000 radio ads. Their use of TV

accelerated to the extent that, on average, people in the UK watched 702

car commercials last year - almost two a day.

In January 1996 alone, a month in which the ITV companies tried to

persuade car-makers to cram competing commercials into the same ad

breaks, there were TV ads for 36 models, owned by 15 different

manufacturers. And in one randomly chosen week at the end of April there

were no less than 24 car commercials - a figure that will increase to

about 30 when the Euro ’96 football championships begin in June.

Let’s put car advertising into perspective. The tenth biggest car

advertiser in 1995, the Ford Fiesta, spent pounds 11.4 million. That’s

more than the biggest food brand, Kellogg’s Cornflakes, which spent

pounds 10.9 million, the biggest household goods brand, Ariel Future,

which forked out pounds 9.1 million, the second biggest drinks brand,

Guinness, with a pounds 9.35 million spend, and almost as much as the

biggest travel brand, British Airways, which spent pounds 12 million.

Combining the Society of Motor Manufacturers and Traders’ sales figures

with those from Register-MEAL reveals that last year the average car

manufacturer spent pounds 425 on advertising for every car it sold. The

biggest spender, Alfa Romeo, splashed out pounds 1,600 per car.

Are car advertisers trying to hide behind mountains of media spend,

hoping that no-one will notice if the creativity in their ads isn’t up

to much? Is the emperor wearing no clothes?

Some people certainly think so. ‘An escalating spiral of insanity,’ is

how one media buyer puts it. ‘The adspend of some manufacturers is

totally out of proportion to their market share.’

Take, for example, the Peugeot 106, Citroen ZX, Volvo 850, Honda Civic

and Volkswagen Golf, which together accounted for pounds 64 million of

the sector’s adspend in 1995. Yet not one of them was a top-ten seller.

On the creative side, consider two prominent car campaigns. First, the

current work for the Renault Megane, which features a car talking to a

boring-looking man who is trying to impress a woman. The best that can

be said about it is that the woman comes across as ‘a fairly strong


Then there’s the Peugeot 406 ‘no such thing as the average man’ ad, with

its M-People soundtrack. Expertly filmed, its random assemblage of

images was supposed to mark a new departure for car ads, away from

exotic cliches and techno-speak and into the cerebral realms of post-

modern life. Well, it may have generated lots of PR on the back of its

News at Ten ad break and funky soundtrack, but it has also been savaged.

In the Sunday Times recently, Jeremy Clarkson quipped that drivers may

fantasise about all manner of weird things while sitting in traffic

jams, but their wish list did not include owning a Peugeot 406.

Mark Wnek, the creative director of Euro RSCG Wnek Gosper, which made

the commercial, claims its ‘genius’ was in making the budget look much

bigger than it actually was, thereby generating free publicity.

But Stephen Knight, an account director at BMW’s agency, WCRS,

disagrees: ‘It relied on hype. Peugeot implied that all cars are the

same; you could have inserted almost any car into that ad. It took

bland, lookalike ads to an extreme.’

BMW is one of the few car advertisers in today’s distorted market to

stand apart from the ‘spiral of insanity’. Observers admire BMW for its

ability to keep advertising costs down.

In our table, only Ford spends less per car. But given Ford’s mass-

market appeal and enormous economies of scale you cannot really compare

the two.

BMW may not be mass-market, but Knight believes its approach could be

emulated by many more car advertisers, if only they would stop and think

a bit more about their advertising before following the herd.

‘The biggest problem today for car advertisers,’ Knight says, ‘is

breaking through all the clutter. But the attempts to get around this

problem have tended to be unimaginative - they usually involve

increasing production costs and resorting to the same small pool of big-

name directors, which only leads to even more similarities between the

campaigns.’ What the Peugeot 406 campaign lacked, Knight argues, was ‘a

very strong idea at its centre’.

BMW’s current campaign for its new 5-series focuses on technical updates

and uses a visual pun to state that the new model is greater than the

sum of its parts.

Its media buying is also designed to leverage a relatively small budget,

by making use, for example, of solus ads in five national newspapers.

‘We’ve consistently built the brand over 16 years,’ Knight says, ‘which

is why we’re able to sustain such low levels of adspend. We’re not

trying to change people’s perceptions of the brand. We’re just

refreshing it.’

Volvo, however, is in the middle of a huge repositioning exercise,

having released a series of Tony Kaye commercials, entitled ‘stuntman’,

‘photographer’ and ‘twister’.

The table shows that Volvo is a top-five spender, with an average outlay

of pounds 583 per car sold. The Volvo communications manager, Craig

Fabian, is unapologetic: ‘I understand and recognise that on a per car

basis our spend is high, relative to some other makers. But it is not

that outrageous compared with some of the other specialist marques such

as Audi and Saab. What we are all doing is trying to reposition our

brands in a much more distinct, upmarket way. And that kind of

communication takes money.’

Ford is in a much stronger position and not attempting anything as

radical as Volvo. However, it still stands accused of recklessly driving

ad budgets into dangerously uncharted territory.

‘Ford is in a battle to the death with the other big volume

manufacturers,’ one observer says. ‘It’s been losing market share over

the years and is driven by a terrible insecurity that it must out-shout

the competition.’

The nightmare scenario of blank cheques being written to hire big

directors and prime-time TV slots hits a peak in June and July when the

industry prepares for the new registration fest in August. The cost of

TV during this period is ‘horrendously expensive’, Knight says,

describing the jamboree as ‘a patently ridiculous situation’.

The good news is that this contrived media spending spree will lessen

when the changes to the method of new car registration take effect.

These are expected to come into play when the current alphabetical run

is over.

In the meantime, there is no sign of anything happening that will bring

the car-makers back to their senses. There seem to be plenty of excuses

for the inflated figures they are chucking around.

‘You have to understand that the market is in such a lousy state,’ Peter

Schmidt, founder of Automotive Industry Data, says. ‘There is a total

lack of a feel-good factor and makers are having to pull rabbits out of

hats in order to persuade consumers to even think about buying a new


Even the likes of BMW and Mercedes are now having to sell themselves

much more aggressively than before. ‘They are all competing so directly

with each other,’ Schmidt adds.

John Evans, the consumer editor of Autocar and Motor, notes that car

manufacturers have got used to living with lower margins. And while some

companies are being wasteful with their ad budgets, Evans says others

are only doing what is necessary. ‘A car’s image is everything. Anything

a manufacturer can do to improve that image is money well spent because

the long-term benefits are so great,’ he explains.

David Miller, who oversees the Ford account at Ogilvy and Mather,

dismisses the criticism of car ad budgets as ignorance: ‘The scale of

the car market is like no other. By definition, it stands out simply

because the size of individual car campaigns would bring tears to the

eyes of people working in, say, food or toiletries marketing. But there

is a genuine need to spend these big sums. Much of it is to do with the

critical importance of getting a launch right. Manufacturers don’t want

to take risks at that stage.’

And despite the enormous ad budgets, Miller claims car advertising

remains a much smaller percentage of total car sales than is the case in

the packaged goods industry - 2 to 3 per cent compared with 10 per cent

or more.

Be that as it may, there are plenty of people in the car industry who

are unhappy about the status quo. So is there another way to cut through

the clutter?

Daihatsu’s marketing director, Richard De Leyser, says his modest budget

forces him to be creative. Daihatsu recently launched a campaign for its

new Hijet MPV that features a live poster site in London with six people

sitting on MPV car seats stuck to a wall. Daihatsu will also be

plastering condom machines with Hijet stickers bearing the message: ‘In

case you slip up.’

Daewoo, another modest spender, eased its entry into the UK by

positioning itself as the most customer-friendly car company. Its

marketing director Patrick Farrell’s answer to cutting through the

clutter is to have a strong message: ‘Customers are most impressed by a

reliable, consistent friendly service and predictable motoring costs.’

Mark Wnek, who may or may not have found a clutter-removing device with

the Peugeot 406 campaign, certainly seems to have the right idea:

‘Imagine the consumer is equipped with a 24-hour anti-selling radar,’ he

suggests. ‘There are two ways of counteracting this. One is to send over

vast fleets of aeroplanes and drop vast amounts of bombs, in which case

you must accept that quite a few of your planes will get shot down. The

other way is to take a little light aircraft and fly under their radar.

This should allow you to deliver a powerful, salient message, relatively



Adspend per car sold in the UK


 1     Alfa Romeo     pounds 1,629

 2     Daewoo         pounds 864

 3     Saab           pounds 736

 4     Hyundai        pounds 665

 5     Volvo          pounds 583

 6     Proton         pounds 581

 7     Kia            pounds 563

 8     Suzuki         pounds 536

 9     Daihatsu       pounds 453

10     Jaguar         pounds 450

11     Skoda          pounds 444

12     Mitsubishi     pounds 434

13     Audi           pounds 405

14     Citroen        pounds 378

15     Seat           pounds 360

16     Honda          pounds 349

17     Toyota         pounds 346

18     Nissan         pounds 318

19     Porsche        pounds 297

20     Renault        pounds 259

21     Fiat           pounds 256

22     Volkswagen     pounds 250

23     Mercedes-Benz  pounds 243

24     Mazda          pounds 230

25     Lada           pounds 227

26     Peugeot        pounds 224

27     Vauxhall       pounds 211

28     Rover Group    pounds 187

29     BMW            pounds 149

30     Ford           pounds 134

The figures quoted here are based on Register-MEAL figures, which may be

grossly inflated in some cases, but are the best indication available.

The figure for adspend per car sold is reached by dividing Register-MEAL

spend figures for the year to December 1995 by SMMT sales figures for

the same period. Some makers will have car ranges that run the gamut

from budget to expensive, but the figures quoted here are still useful

for comparing like with like. For example, Ford against Vauxhall or

Citroen against Volkswagen. Also, can Proton’s pounds 581 per car be

justified against BMW’s pounds 149 per car when the two companies have

similar advertising budgets? Proton may be trying to reposition itself

as more upmarket, but its cars are still considerably cheaper than

BMW’s. Several other chunky adspend/sales ratios must also be seen in

the context of repositionings -  for example Volvo and Saab.



Top 10 sellers 1995


 1     Ford Escort

 2     Ford Fiesta

 3     Ford Mondeo

 4     Vauxhall Astra

 5     Vauxhall Cavalier

 6     Vauxhall Corsa

 7     Rover 200

 8     Peugeot 306

 9     Renault Clio

10     Rover 100

Source: SMMT



Top 10 advertisers 1995


 1     Vauxhall Corsa           pounds 15.6m

 2     Ford Escort              pounds 15.2m

 3     Peugeot 106              pounds 14.9m

 4     Ford Dealer Support      pounds 14.7m

 5     Renault Clio             pounds 14.0m

 6     Citroen ZX               pounds 13.3m

 7     Volvo 850                pounds 12.9m

 8     Peugeot 306              pounds 12.6m

 9     Honda Civic              pounds 11.5m

10     Ford Fiesta              pounds 11.4m




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