Chrysler releases $9m Super Bowl ad while requesting more taxpayer dollars

[Deberg_1990]

http://washingtonexaminer.com/blogs/...xpayer-dollars




You may have noticed that Chrysler released the longest ad in Super Bowl history on Sunday night, featuring the new Chrysler 200 driven by Detroit native rap star Eminem, an ad that CEO Sergio Marchionne says cost less than $9 million. But given that the company's CEO also announced this past week that is seeking a "better deal" on government loans, it is likely that this ad had more to do with getting political support than selling cars. Besides, is spending millions on a Super Bowl ad appropriate for a company that received a taxpayer bailout to recover from a bankruptcy?

Maybe the ad wasn't an appeal to car buyers, but rather politicians. According to the Detroit News, Chrysler is seeking a better deal on its bailout:

"I am paying shyster rates," Marchionne said, noting that Chrysler had no choice in 2009 but to pay the high interest rates the government set as part of its $15 billion Chrysler bailout. "We had no choice… I am going to pay the shyster loans."

He called the loans "a thorn in my side."

Chrysler's also in talks with banks to refinance its debt and plans to have an "agreement in principle" by end of March, he said.

Marchionne spoke at an auto industry conference sponsored by JD Power at a hotel here ahead of the National Automobile Dealers Association three-day convention. He said he is hopeful that the company can win an agreement in principle for $3 billion in low-cost Energy Department retooling loan — a move that is necessary for Chrysler to win private financing, Marchionne said.

That's right: Chrysler took $15 billion from taxpayers, to which it wasn't entitled, and at an industry convention its CEO calls taxpayers a word that is defined as "someone who acts in a disreputable, unethical, or unscrupulous way, especially in the practice of law, politics and used car sales." Message received: "Taxpayers' money saved a car company from bankruptcy and all they got was this lousy Super Bowl commercial."

And what a commercial. Chrysler turns to America to say that because Detroit has been "through hell and back" it has endured the "hottest fires which makes the hardest steel," and that the reason people don't know that is because newspaper reporters "don't know what [people in Detroit] are capable of."

A few things about that.

One: Chrysler didn't go through the hottest fires. Unless, of course, "hottest fires" means "skipping bankruptcy" and asking for a handout to protect union pensions, which it got. And when Fiat was able to take control of Chrysler, it was because of a heavily politicized deal facilitated by the president's auto task force. It even got $6.6 billion in exit financing by Uncle Sam. Most failing businesses have trouble finding buyers. Not Chrysler.

Two: Detroit may have been through a self-imposed over-taxed, over-regulated hell, but it certainly hasn't come back. Budget numbers still show Detroit's books in the red, despite Mayor Dave Bing's best efforts to rein in spending. And Pew reveals that Detroit residents spend more for their municipal legislature than any other major city in the U.S. Heck, even its library is facing a dire fiscal crisis.

Three: We know what Detroit is capable of because we saw it in the 1960s. We still see potential, too -- Michigan economist David Littman told The Examiner last year that there was plenty of reason to be optimistic:

"We're not even on the map," Littman notes. But the opportunity is there. "We have bargain basement prices on everything -- from water properties, which are a hallmark of growth, to infrastructure. And this is tied together with a large and progressive highway system. We also have the largest underground gas reserves in the nation."

Chrysler must have found the investment worthwhile, using the opportunity of the new Chrysler model to plug Detroit's tough "know-how." Fox was charging approximately $2.8 to $3 million per 30-second slot.

This ad doesn't reveal how tough and competent Detroit is. It shows how the federal government picks winners and losers. Guess which part the taxpayers play?

[chiefzilla1501]

Originally Posted by ChiefsCountry

You are over thinking this. Its not about the car. Its about Chrysler. Car is the random part of this ad. Chrysler is what they are going for and the Chrysler brand has gotten a great PR hit on. We wouldn't be on here talking about it if they had ran a normal advertising campaign. But the Super Bowl in general isn't niche marketing, its about making a splash and Chrysler nailed it.

When you buy an unheard of $9.5M spot, you pay a famous rapper a million or so to star in it... they probably paid somewhere between $12-13M total for the spot. It's absolutely about the car. For an expensive ad buy, you better over a 5-year period sell a lot more cars. For a $12-13M one-time buy, your sales better be exploding. My guess it that over 90% of the crowd watching the Super Bowl either would never buy a Chrysler, or hates Eminem, or will probably forget about the ad in a few months. Several more % will never motivate themselves to shop for a car, others will read reviews and realize that they don't want the car, others will put it in their top 3 and realize they wanted another car more. A car isn't a candy bar--there is a lot that has to happen for that buzz to turn into a sale. And my guess is that when the dust settles, Chrysler will make a few more sales, but not nearly enough to justify the expense.

That's why "niche" marketing is more popular these days. Because Chrysler spent probably $10M to reach a crowd that will never have interest in a Chrysler, even if it came with a free Heidi Klum. Meanwhile, in a targeted "niche" media buy, well over half of the people watching will probably be interested. And you do it for a very, very, very small % of the cost of a Super Bowl ad. I'd rather reach a guy who might want to buy my car 10 times with a cheap media buy than miss on 9 people to get 1 guy who might be interested to see it once.

Being in the business, people get so gung ho about buzz. it's not about buzz in a high impact purchase like a car. It's about selling cars. Oh, and by the way, those Old Spice "Man your man could smell like" that created a ginormous buzz for a fraction of Chrysler's Super Bowl buy? They really haven't sold any more body wash because of it. Buzz is overrated.

[KcMizzou]

The ad itself was outstanding. I think it needed the longer running time for the slow build. It felt like a theatrical movie trailer. I don't know if it makes me want to buy a Chrysler, but it made me want to watch 8 Mile again...lol

[chiefzilla1501]

Originally Posted by Rukdafaidas

In a marketing class in college, we found that a Superbowl commercial was one of the least expensive ways to advertise. If you figure it as cost per person viewing the ad. It was much cheaper than any other way at the time.
Take this ad for example. They said that 111 million people saw the Superbowl in the US alone. If everyone caught this commercial, that's $9m/111m = $.08 per person......Not bad at all. That's cheaper than direct mail.
Hell, 4 million people have viewed the same ad on youtube.com and it didn't cost them anything for that.

The more important measure is targeted impressions. And over 90% of the Super Bowl audience, I would imagine, is not in the demographic for this ad. They're either too old or conservative for Eminem or have too high of an income to want a Chrysler.

Furthermore, you're assuming that someone can see the ad once and immediately have a reaction. Studies have shown you have to see an ad 5-7 times to even get you to consider the brand. Even moreso, probably, for a brand like Chrysler that has a lot of image issues to fight.

[underEJ]

Originally Posted by Brock

I get it with car advertising, but I really do not think anybody ever drank a coke or a pepsi based on advertising.

I think it's pretty well known that the Pepsi Challenge ad campaign made Pepsi the big player it is now.

I liked the Chrysler ad, I thought the car looked nice, way better than it ever did as a Sebring. They got so many more views Monday than just the Super Bowl run. I would guess it is considered very successful branding, and it will be a year before sales results will be available to judge the return.

[BigRedChief]

Originally Posted by chiefzilla1501

The more important measure is targeted impressions. And over 90% of the Super Bowl audience, I would imagine, is not in the demographic for this ad. They're either too old or conservative for Eminem or have too high of an income to want a Chrysler.

Furthermore, you're assuming that someone can see the ad once and immediately have a reaction. Studies have shown you have to see an ad 5-7 times to even get you to consider the brand. Even moreso, probably, for a brand like Chrysler that has a lot of image issues to fight.

Your marketing education and experience notwithstanding you are missing the point. Look no farther than this thread. There are other threads like this on other boards. There are private conversations taking place about the ad. Whole cities are talking about it. That is worth more than ads on late night MTV.

[ChiefsCountry]

Originally Posted by BigRedChief

Your marketing education and experience notwithstanding you are missing the point. Look no farther than this thread. There are other threads like this on other boards. There are private conversations taking place about the ad. Whole cities are talking about it. That is worth more than ads on late night MTV.

Exactly. It wasn't a niche marketing ad. No shit they could have spent less to sell that certain car and hit the right people, but it wasn't about that. People are talking about Chrysler, the 200 car was just the prop. Chrysler is back into people's minds which is what they were going for.

[Marcellus]

Chrysler 200 was reported to be the top google search Monday morning.

I would say that was $ well spent.

[chiefzilla1501]

Originally Posted by BigRedChief

Your marketing education and experience notwithstanding you are missing the point. Look no farther than this thread. There are other threads like this on other boards. There are private conversations taking place about the ad. Whole cities are talking about it. That is worth more than ads on late night MTV.

I'm not missing any real point. How long do you think the buzz will last? Think one week from now there will be any water cooler conversations about Chrysler? And again, how many people talking about Chrysler have any even remote intention of even considering buying one in the next 5 years? Slim to none. That's the problem with buzz. We assume that because people are talking about it, that's going to lead to people buying your product.

The Old Spice guy was buzz (and by the way, on a fraction of the budget Chrysler spent). Funny ads that people talked about months later and still do. For $12M, Chrysler doesn't come close to touching that buzz. Same with E*Trade baby--a 30-second spot and 3 years later, people still talk about it.

I've seen the research. A ton of ads get a lot of hype because they were entertaining ads that got people talking, but nobody ended up buying the product. In the end, people are interested in brands, but they still have to buy your car. That ad got people talking a lot about Eminem and Chrysler, but have you heard a single person talk positively at all about the car they're selling?

[chiefzilla1501]

Originally Posted by ChiefsCountry

Exactly. It wasn't a niche marketing ad. No shit they could have spent less to sell that certain car and hit the right people, but it wasn't about that. People are talking about Chrysler, the 200 car was just the prop. Chrysler is back into people's minds which is what they were going for.

And it will be out of their minds in 1-2 weeks.

[rtmike]

I don't understand how the CEO wanting better interest rates 11-12% on the bailout loan means Chrysler is after more money from tax payers?

Supposedly Fiat has some bank loans lined up at cheaper interest rates. So they'll be paying off the government. But the government bailed out the banks too so?

As a Mopar supporter I'm glad he's trying to save some money any way he can. I'm willing to bet the loans will be paid off so I don't give a shit how they spend the money.

[BigRedChief]

Originally Posted by Marcellus

Chrysler 200 was reported to be the top google search Monday morning.

I would say that was $ well spent.

Chiefzilla101 the marketing draftubator of the Planet says you are FOS.

[chiefzilla1501]

Originally Posted by Marcellus

Chrysler 200 was reported to be the top google search Monday morning.

I would say that was $ well spent.

So $12M to get to the top of Google for one morning?

I guess Matt Cassel was a steal.

[ChiefsCountry]

Originally Posted by chiefzilla1501

And it will be out of their minds in 1-2 weeks.

And then that is when you hit with your regualar targeted marketing campaign.

[|Zach|]

Originally Posted by chiefzilla1501

So $12M to get to the top of Google for one morning?

I guess Matt Cassel was a steal.

I think the fact that a bunch of random assholes on a football message board are sitting around talking about Chrysler at all is pretty impressive evidence.

You are blowing off being a top google search. The trickle down effect from something like that is staggering.

I don't think it is that much money at all for what they will get back. 12M?

Not a huge deal.

[chiefzilla1501]

Originally Posted by |Zach|

I think the fact that a bunch of random assholes on a football message board are sitting around talking about Chrysler at all is pretty impressive evidence.

You are blowing off being a top google search. The trickle down effect from something like that is staggering.

I don't think it is that much money at all for what they will get back. 12M?

Not a huge deal.

It's a very big deal. For $12M, you can buy 2,400 30-second spots in New York. And that's buy and far the most expensive market in the country. 2,400.

And Paid internet search? For a full year, I'm pretty sure companies generally spend in the low millions. $12M for one week at the top is an accomplishment?