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MarketingVOX: Despite some questions over the actual size of the cut, General Motors reduced its 2006 advertising spending significantly, reports Advertising Age.
TNS Media Intelligence reports GM cut over $600 million from its advertising budget last year - a 23.6 percent decline from 2005 levels. GM disputes that number, saying it cut nearly 10 percent, or $300 million. TNS, though, is sticking to its original number, saying the methodology it employs to measure spending did not change from 2005 to 2006.
What's not in dispute is that an increasing portion of GM's ad budget is going toward digital media as it seeks to connect with the online audience. Last year it launched the Pontiac G5 with an online-only campaign, a strategy that resulted in spending 60-70 percent less than if the campaign had gone through traditional media.
Should GM continue to rely more on new for its advertising, it could send shockwaves through the ad industry. Agencies would likely ramp up their online efforts to retain clients, and media outlets would reevaluate how they were integrating online into their ad selling.
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