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GM Wants to Drive Upfront in Reverse

TV ad sales execs say automaker General Motors is looking for double digit rollback in prices for the ads it buys in this year’s upfront.

GM has already made noise in the market by canceling $10 million worth of advertising on Facebook and opting out of CBS’ Super Bowl. Former media agency executive turned analyst Brian Wieser says those moves signal that GM is looking to boost its leverage by demonstrating it’s willing to walk away from any negotiation with any media owner.

Ad sales executives say that point was also made in meetings wtih GM and its new agency, Carat. In one meeting, GM reversed the upfront process by pitching shows it wanted to sponsor. In another, it asked for marketing ideas. Finally, GM said that in the upfront process there would be winners and losers, meaning that networks that didn’t play ball wouldn’t be bought. Some sales executive said GM and its agency have let networks know they’ll be looking for price rollbacks-a tough request in a market where most buyers and sellers expect rising rates, even from Carat’s other clients.

GM wouldn’t comment and Carat is working under a non-disclosure agreement.

Though GM is a huge advertiser its activity would have a minimal impact on the market, Wieser says. Whatever dollars it pulls from the market would be more than replaced by new advertisers, growing categories like tablets and heath care insurance, and marketers like Pepsi increasing spending. “If they [GM] are widely applying aggressive negotiating tactics as we suspect that they are, they’ll probably do better on pricing. They’ll be serviced badly, but they may accomplish their short term goals just fine,” he says.

Meanwhile, in a week where buyers and sellers felt each other out, there was some interesting scuttlebutt, including talk of a “concept deal” between a broadcast network and an agency, giving the agency a lower price increase in exchange for a larger share of spending. There was also talk that networks were talking C5 and that agencies were looking to include pure digital players in their web video negotiations to push the TV networks’ CPMs lower.

Talks could turn more serious this week.