DaimlerChrysler Announces Shift away from TV Advertising

31 May 2001

DaimlerChrysler – America’s third largest advertiser and number two in terms of TV spend – has announced it is to reverse recent policy and divert advertising funds from television into fashion and entertainment-based marketing.

Chrysler has been steadily increasing its television outlay of late – in the past four years, TV spend has risen by over 38%, from $868.8 million to $1.2 billion. Much of this money, according to recently appointed vp-sales and marketing Jim Schroer, has been wasted: “The consumer is almost numb to a lot of the traditional Detroit car and road marketing campaigns” – dismissed by Schroer as “here is the car on the road, here are the financing terms.”

The change in strategy – which will not affect the Mercedes marque – is described as long-term and of significant size. As part of the new focus, Chrysler has hired Peter Arnell, the marketing mastermind who turned DKNY into a huge global brand. Arnell, who has never worked on a car account before, believes the same fashion-oriented approach will work for Chrysler as worked for Donna Karan.

The news could not come at a worse time for the big networks, whose upfront sales season has been sluggish to say the least. Advertisers are expected to spend only $7.3bn during this year’s upfront, compared to $8.2bn last year.

Schroer, however, believes the television industry has only itself to blame. “The networks keep raising their rates so much. [They] could get away with that in the past when the rest of the world only watched a few TV channels. But today, it is difficult to get a consumer’s attention on network TV.”

The first brand to benefit from Chrysler’s new fashion-related strategy will be the redesigned Dodge Ram pickup, slated for launch in the fall. Added Schroer: “The heyday of truck advertising was in the 1960s and early 1970s when people were watching network TV. There isn’t anything new that can be done with primary media anymore.”

News source: Wall Street Journal