GM marquees/brands: how were they able to support so many in the past?

From an older thread:

I’ve been meaning to ask this for a while. How was it that back before WWII, before the United States had a overwhelmingly dominant middle class that could afford automobiles, was GM able to maintain so many brands in the United States, but they aren’t even able to maintain more than a few today? (Chevrolet, Buick, Cadillac, and GMC exclusively for trucks and SUVs) One might say that there wasn’t foreign competition then that would have whittled GM’s market away, but in place of Honda, Toyota and the like, there were many other American auto brands; Packard, Hudson, Kaiser, Hupmobile, and the like, along with the few that survived to the present (Ford, Lincoln, Chrysler, Dodge).

They were flush with cash and the wasteful costs of maintaining too many brands didn’t keep them from making gobs of money.

There were fewer international competitors so they covered a broader spectrum of the market and the brands gave the illusion of more variety than there actually was at the time.

They saw it as strategically important because brand diversity was a prevailing strategy in the evolving approach to brand management that Sloan pioneered at GM in the late 20’s…

All I got for now.

I don’t really get what costs are necessary for brand differentiation. Why couldn’t every single G.M. car model have a different brand, for example, the way that most consumer goods are sold?

Pre-1940 those weren’t so much brands as we think of such a thing today as they were models. Each “brand” was only producing 1 or 2 models, and often the 2nd model was merely a variation on the 1st. Only after the end of WW2 did they start expanding their product lines and become more like the individual brands we know them as.

Brand loyalty was big in the 1950s and 60s. Someone who liked a Pontiac would want to buy a Pontiac and would not necessarily move to another GM brand if Pontiac went out of business. So you keep making the brands.

There were also the dealers; any contraction of brands would require a contraction of dealers. They sold Oldsmobiles and didn’t want to be faced with the option of changing to Buicks and now competing with the bigger Buick dealer across town.

The cost to develop and promote a brand are quite large. Most CPG’s (Consumer Packaged Good companies, like P&G or Colgate Palmolive) organize their businesses into separate divisions based on brand - so there is a President of the Tide group, the Crest Toothpaste group, etc. If you maintain two brands - e.g., Tide and All detergents - and they are managed separately, then you have redundant capabilities. Now, if you make enough money from these businesses, that is entirely worthwhile - e.g., GM running separate businesses for each brand up through about the 1970’s - after that, they weren’t making enough money to justify the redundancies…