GM Names New Ad Agency to Market Cadillac

General Motors Corp. (GM) on Monday named a new advertising agency to market Cadillac, the first such shake-up for the luxury brand in over 70 years by the No. 1 automaker as it looks to reverse a costly loss in market share.

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GM said in a statement that it has assigned all of the creative work related to marketing its Cadillac line-up to Modernista! ad agency, which handles advertising for GM's Hummer oversized military-style sport utility vehicles, effective October 1.

Leo Burnett Detroit had handled the Cadillac account since 1935. After the changes, that agency will remain responsible for marketing GM's Pontiac brand and the automaker's parts and service operation, GM said. Leo Burnett is a subsidiary of France's Publicis.

Mike Jackson, GM's advertising chief, said he expected that Boston-based Modernista!, a relative upstart in the advertising industry, would bring "a fresh point of view" to the Cadillac brand.

Cadillac ranks as a standout bright spot for the automaker, with four straight years of sales growth.

Over the next several years, GM will be revamping Cadillac's model line-up, starting with the launch of the 2007 Escalade SUV, and company executives said that would coincide with a marketing drive intended to win over a new group of consumers.

"This is a very competitive segment, and we're going to be out this time for conquest sales" to consumers who had never considered buying a Cadillac, said GM spokeswoman Ryndee Carney. "And we think Modernista! is the agency to help us take the brand to the next level."

Modernista! has handled all of GM's marketing for its Hummer brand. One of the quirky television spots by the agency for Hummer's H3 model features a romance between a giant lizard and a giant robot who fall in love and spawn the mid-size SUV. The tagline reads: "It's a little monster."

Leo Burnett Detroit and McCann Erickson Detroit will work together with a third firm, the Martin Jay Retail Group, to handle GM's local marketing efforts in conjunction with dealers, the company said. McCann Erickson is part of Interpublic Group of Cos. Inc.. Martin-Jay is an affiliate of both Interpublic and Leo Burnett.

"We regret Cadillac has made the decision to part ways, but we remain deeply committed to GM and plan to be part of their continued comeback," Leo Burnett Detroit President Jim Moore said in a statement.

GM's sales fell 8 percent in the first five months of this year from the same period a year earlier.

The company is shuttering a dozen factories and shedding over 30,000 factory jobs as it looks to adjust to its loss of share in the U.S. auto market.

GM executives are expected to announce new marketing initiatives for the third quarter, including some zero-percent financing offers on Tuesday.

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