GM, Ford sign alliances with AOL, Yahoo

Automakers are reinforcing their Web sales through partnerships with Internet companies to reach more car shoppers.

Feb. 6, 2002 8:55 a.m. PT

3 min read

DETROIT--General Motors and Ford Motor announced marketing alliances with the world's biggest Internet companies, America Online and Yahoo, as more companies go online to reach customers.

Terms of the agreements weren't disclosed. GM, the world's biggest automaker, will link its car sales Web site to America Online while the No. 1 online service adds content to GM's OnStar communications system. Ford, the world's second-largest automaker, unveiled a campaign to market its vehicles on Yahoo.

Automakers are reinforcing their Web sales through alliances with Internet companies to reach more car shoppers. The Internet companies stand to gain additional traffic and advertising. The number of car purchases influenced by Internet shopping is expected to quadruple to 8 million by 2003, resulting in 500,000 sales, according to Forrester Research.

"The automakers are trying to fight in a very competitive market for customer attention," said David Garrity, an auto analyst at Dresdner Kleinwort Benson.

The announcements came on the opening day of press previews at the North America International Auto Show in Detroit.

Yahoo will offer custom services that allow Ford vehicle owners to schedule service appointments, plan trips and vacations, get traffic updates in large metropolitan areas and access owner guides and recall notifications. Ford owners will be able to access the personalized services at the Yahoo Autos Web site or OwnerConnection.com from Ford.com.

Yahoo, with an audience of 105 million users, has been gaining bigger advertising agreements with large companies such as Procter & Gamble, which want to reach their customers and other potential consumers over the Internet.

"It validates the Web" as a medium for advertising, said Yahoo president Jeff Mallett about the Ford agreement. "It's imperative for them to use the Web to build a relationships with their customers."

Yahoo co-founder Jerry Yang said the agreement with Ford doesn't preclude his company entering similar alliances with other automakers. "This is not exclusive to Ford because we take advertising from a lot of companies," Yang said.

Yahoo will provide links from some of its Web sites to Ford's Web site. Internet users can access Yahoo clubs and message boards related to their vehicles and participate in online chats with Ford engineers and other officials.

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Yahoo will create a database of users for Ford that the Santa Clara, Calif.-based company will use to target advertising to users. "We also see this as a vehicle to attract new customers to our Web site," Mallett said.

Yahoo created a similar advertising campaign for Procter & Gamble in July that integrated promotions of P&G products such as Pringles, Pepto-Bismol and Pampers among Yahoo Web sites.

AOL will offer a link to GM's BuyPower Web site for information on new vehicles and for online purchases, while GM will buy advertising from America Online. The Internet company would also provide online services to OnStar, GM's satellite system for providing drivers with help and information.

The accord calls for GM to make AOL software available through the automaker's marketing channels. Dulles, Va.-based America Online is the biggest Internet service, with more than 20 million subscribers.

GM will offer voice-activated access to the Internet on what it calls a significant number of U.S. vehicles this year as an OnStar option. GM expects to install OnStar in about 3 million cars and trucks in the next few years, up from 100,000 now.