Automakers Cling To Events In Tight Economy

VW Jetta TDI CupEvent marketing may be benefiting from the tight economy, as automakers put more bucks into local events to tout their products. Grassroots marketing centering on automotive lifestyle events saw new life in the late 1990s and really took off after 2000, with events like General Motors' Auto Show in Motion, Taste of Lexus, and Mercedes' C-Spot events.


Automakers bring in companies like Detroit and L.A.-based AMCI and Rocky River, Ohio-based Automotive Events to run them. The latter says it has nearly doubled revenue, from $8.5 million last year to $15 million so far in 2008.

Erich Gail, EVP of Automotive Events--which counts Subaru, VW, Jaguar, Hyundai, Land Rover, Toyota, GM and Honda among clients--says GM's decision to cut funding for the national Auto Show in Motion event for regional events and Honda's replacement of its Civic Nation program with a more regional program have been emblematic of what has happened in the auto events world.



"These events have continued to evolve from large, national-footprint programs that could be $50 million investments to regional programs that have very specific brand messages around a specific vehicle," he says. "There is a transition of marketing dollars being funneled into experiential-marketing events. They are now more like product summits connecting with consumers on their own ground." He says that such local-flavor events supported by national ad dollars should--and are beginning to--involve dealers.

"Dealers are participating not on-site but as a facilitating arm, sending out mailers to their customers to attend these events, and offering retail info at the event. [Automakers] have not traditionally wanted to include retail, because they didn't want to have a hostile 'push' environment at these events. But the retailer is the final connection; to invest all this in brand experience only to have it fail at retail is costly."

He says with such regionalized auto events, "national" picks up between 50% and 60% of the total cost with the balance split between regional dollars and dealer dollars.

The firm is also involved in developing motorsports events--which Gail says are essentially lifestyle events--for automakers like VW and Jaguar that frame weekend races at tracks with two-day consumer experiential events.

The company helped run a U.S. program for VW this year to promote its diesel lineup as high-performance and green by showcasing diesels on the track. The "VW Jetta TDI Cup" comprised eight races around the nation and Canada.

"We are promoting clean alternative technology, and the goal is not only to talk about great mileage but the smaller carbon footprint of diesel. So, from tent structures to lighting, to cutlery and dining ware [at the events]--everything had to have a sustainability story," says Gail.

The Jetta TDI Cup races were not stand-alones, but were tied into existing race weekends such as the American Le Mans Series, which can bring in some 60,000 people. Gail says the races will be reprised for at least the next two years.

The firm will also handle Jaguar's "Legendary Performance Tour" next year--a national program that is regionally focused.

John Thorne, Automotive Events CEO, says the first such Jaguar event was this year at New York's private Monticello racetrack. "It was designed to be a high-end auto show so that when folks arrive, they are in similar vehicles that are coming up on the end of their leases."

In addition to racetrack hot-lap opportunities, the New York event featured a lounge, food, uniformed greeters and merchandise. "At the end of the event, they walked away with what it is like to drive the vehicle and what it's like to be part of that lifestyle."


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