Magazine article Marketing

Tech

Magazine article Marketing

Tech

Article excerpt

Does General Motors' withdrawal from Facebook ad spaces mean it is antisocial? Does Facebook really understand advertising? George Nimeh looks for the answers.

Just as the world's biggest social network went public, General Motors, the world's biggest car-maker, pulled dollars 10m in direct advertising from Facebook. Let's consider some possible explanations for this decision and what marketers can learn from it.

EXPLANATION 1: GM doesn't get how social advertising works

It pulled dollars 10m in Facebook ads, but according to The Wall Street Journal, GM is still spending dollars 30m on Facebook content. GM marketing chief Joel Ewanick told the paper that the car manufacturer 'is definitely reassessing our advertising on Facebook, although the content is effective and important'.

Given the 'experimental' size of GM's budget, and Ewanick's penchant for unorthodox moves, this looks more like a hunt for efficiency and a better ROI than a damnation of the platform.

EXPLANATION 2: Facebook doesn't know how advertising works

If the third-biggest advertiser in the US is pulling cash off the table, something must be wrong, right? GM's dollars 10m is, relatively speaking, a drop in the bucket compared with Facebook's dollars 3.7bn in revenue, but any such move by a major player should be seen as significant.

Facebook's offer is still nascent - and in cases like mobile, almost nonexistent - so it's too early to say 'it doesn't get it'. New social ads, including Sponsored Stories, are quietly overtaking standard Marketplace ads, and smart marketers would do well to check them out. …

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