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GM Signs On As Manchester United's Auto Sponsor

Reuters, May 31, 2012

By Ben Klayman

General Motors Co has signed on as the automotive sponsor of the world's most popular soccer club, Manchester United, in an attempt to cement Chevrolet as a global brand.

Terms of the five-year deal, announced in Shanghai on Thursday, were not disclosed. GM is hoping to piggyback on Manchester United's fan base of an estimated 659 million people to boost its Chevy brand, especially in such growing Asia car markets as China, where the soccer club has 108 million fans.

"If our aspirations are to build global icon status for Chevrolet ... soccer far and away is the world's biggest sport," GM executive director of global marketing strategy Paul Edwards said in an interview.

"Manchester United stands head and shoulders above the other teams in terms of scale, brand value and their legacy in the sport."

The announcement comes about two weeks after GM said it would drop ads both on Facebook, due to low consumer impact, and during next year's Super Bowl broadcast, as the projected price tag – $4 million per 30-second spot – was too high.

GM has also consolidated its ad agencies globally in a move expected to save $2 billion over five years.

But Edwards dismissed talk that the Detroit company was simply cutting costs and lacked a coherent marketing strategy.

"They're just normal course-of-business decisions that we make with any traditional media outlets," he said. "We're getting smarter in the way we invest and we're going to assess every decision we make very carefully."

Edwards said other changes in marketing would be announced, but declined to provide details – except that the focus now was on soccer. "There is a cadence of big global decisions coming forward," he said.

Edwards said the Manchester United sponsorship deal shows GM is shifting its investments where they can do the most good for Chevy brand awareness and sales.

Starting Friday, Chevy will be one of almost 30 corporate sponsors for Manchester United, replacing Audi as the English soccer club's auto sponsor. Audi had been the team's auto sponsor since April 2004.

Under the deal, the Chevy bowtie will appear on signs, scoreboards and player benches in the soccer club's stadium as well as on backdrops and chairs during interviews, GM said.

Manchester United's larger sponsorship deals with insurance broker Aon, whose name appears on the team jerseys, and with sportswear maker Nike net it between $30 million and $40 million per year.

GM spent an estimated $170 million to $175 million on U.S. sponsorships, festivals and causes last year, down from $185 million to $190 million in 2010, according to IEG, a unit of WPP that tracks such spending.

GM spent $1.1 billion on U.S. ads last year, ranking it behind only Procter & Gamble Co and AT&T Inc, according to ad-tracking firm Kantar Media, also owned by WPP.

Overall, GM's spending on advertising rose 5.2 percent last year to $4.48 billion according to the automaker's annual report and officials have said the budget is expected to remain largely unchanged this year.

Edwards pointed out that Manchester United's TV audiences easily outpace those of the Super Bowl, which annually ranks as the most watched TV program in the U.S. market with more than 100 million viewers.

Manchester United's 2011 Champions League final against Barcelona was watched by about 350 million people, and even the average game draws 50 million globally, according to club officials.