plans to push its Chevrolet brand and specifically highlight the Volt extended-range electric vehicle as part of an exclusive television advertising deal for the London 2012 Summer Olympics.
GM confirms its bow-tie division will have a “strong presence” during the games, but does not elaborate because details of the strategy continue to take shape.
GM inked a deal to be the sole domestic auto maker advertising during the NBC telecast, July 27-Aug. 12.bought rights to be the exclusive foreign-based auto maker to advertise.
Sources tell WardsAuto the Volt will receive special attention during the Olympics with a batch of new television ads. Current commercials for the one-of-a-kind vehicle featuring owners talking about their fuel savings serve as stopgap before the Olympics push.
GM has been searching unsuccessfully for an effective way to communicate the Volt’s technology to consumers and has tasked its marketing group with clearing up misunderstandings and to spurring sales.
“The hardest thing we have with the Volt is explaining how it works,” GM North America President Mark Reuss told WardsAuto in a recent interview. “Once you do, people say, ‘Geez, that’s pretty cool.’ The education process is really tough. That, more than anything, is the toughest thing we have with the car.”
The Volt uses a battery for up to 50 miles (80 km) of electric propulsion before a small internal-combustion engine switches on to act as a generator and supply electricity for a full range of about 320 miles (515 km). After that the car must be plugged in or refueled.
The fuel-saving messages GM has created for the car so far have been met with unspectacular results on the sales floor. The auto maker sold 7,671 Volts in 2011, the car’s first full year of availability, far short of the auto maker’s goal of 10,000.
A safety investigation by the National Highway Traffic Safety Admin. after the battery pack of a crash-tested Volt caught fire late last year got sales off to a slow start in 2012, with deliveries falling to just 603 units in January.
As a result of its weak showing, GM decided to suspend Volt production for five weeks in March to trim high inventories.
However, sales bounced back in February to 1,023 units and a record 2,289 in March, according to WardsAuto data, prompting the auto maker to shave a week off the production suspension. Inventories closed March at 61 days’ supply from prior-month’s 154.
With a special model newly available to EV-hungry California customers allowing them to drive their Volts in high-occupancy-vehicle lanes, optimism for the car again is running high at GM.
Dan Akerson, GM chairman and CEO, told journalists recently he thinks the Volt could sell as many as 3,000 units monthly for the rest of this year.
Mike Bernacchi, a professor of business administration at the University of Detroit Mercy and an advertising analyst, thinks two weeks of Olympics TV commercials, including the prime slots during the opening and closing ceremonies, give GM a good chance to tell the Volt’s story.
That said, he does not see how it will improve sales of the $40,000 car.
“For the time being, the die has been cast,” Bernacchi says. “Understanding how it works subverts the real issue. The price of the car is not competitive with gasoline-powered vehicles now providing better-than-ever fuel economy.”
GM and Chevrolet are longtime major advertisers at the Olympics, where Bernacchi estimates a 30-second television spot could cost about $600,000
That makes the Olympics one of TV advertisers’ most-prized events albeit well shy of the $3.5 million media buyers paid for the Super Bowl and $1.7 million commanded by the Academy Awards show earlier this year.
Auto makers in recent years have expressed mixed opinions about big-event advertising., for example, spends very little on the Super Bowl, while can be found front-and-center on professional football’s biggest day.
“The Olympics does what the NCAA college basketball tournament does. It gives you a chance to develop a real message and follow it through, rather than repeating the same thing over and over,” Bernacchi says.
GM also spent big on last month’s college basketball tournament, with Buick supplanting longtime sponsor Pontiac as the event’s lead advertiser for the second consecutive year.
GM’s presence during the Olympics telecast also would give the auto maker a chance to further develop its 6-month-old “Chevy Runs Deep” campaign. The effort bowed during Major League Baseball’s World Series, another event played over multiple days, but it has not met with the success GM expected.
The advertising firm Goodby, Silverstein & Partners created the campaign and was tweaking it before GM announced last month Chevrolet’s global advertising would go to a consortium of agencies called “Commonwealth.”
Commonwealth combines San Francisco-based Goodby with McCann Erickson of New York to work the Chevy account.
Other GM brands, such as Cadillac, also will see airtime during the Olympics telecast.