GM Hands Facebook a PR Challenge


General Motors has dropped Facebook from its digital advertising budget, saying that it does not believe buying ads on the social network is effective in converting users to customers. This couldn't have come at a worse time for Facebook, which is preparing for its much-ballyhooed public stock offering on May 18.

As first reported by The Wall Street Journal, GM says it will continue to promote its products via free Facebook pages. According to WSJ, GM allots about $40 million to content created for and promoted across the site, $10 million of which has been, until now, devoted to paid advertisements. The other $30 million includes paying agencies to manage GM’s pages.

GM’s decision to stop buying ads on Facebook goes to the heart of questions about the value of the social network as an ad platform, and will force Facebook's communications team to work harder at proving that value to potential investors—and to brands that are considering buying ads on Facebook. GM is the third largest advertiser in the U.S.—it spent $1.1 billion on U.S. ads in 2011, according to Kantar Media, per Reuters. GM’s decision may have a long-term effect on how investors view the viability of Facebook’s ad platform in driving revenue, something that Facebook has been heavily touting ever since it held a high-profile conference for marketers in February 2012.

For what it’s worth, other automakers cited by WSJ say they are confident in Facebook’s ad platform. And GM still sees value in Facebook's reach and potential to drive consumer engagement with brands.

Follow Sahil Patel: @sizpatel

 


Comments Off

Deals of the Week

Get $150 Off PR News' Social Media Summit

Social Media Summit with Taste of Tech 2015Join PR News at the Marriott Marquis in New York on Oct. 5 for the Social Media Summit, where expert communicators will share in-depth case studies from their social efforts. “Taste of Tech,” a unique element of the Summit, will feature partners who “get PR” and can help you make your social initiatives more impactful.

Use code “150” at checkout to save $150 on the regular rate.

Get $50 off PR News' Crisis Management Guidebook

PRNews-Crisis-guidebook-180x150-sb

Crisis management is an art, not a science. In this edition of PR News’ Book of Crisis Management Strategies & Tactics, you will discover many different views on this art, and you are certain to find takeaways that will transform the way your organization handles crises. 

Use code “50off” at checkout.

Save $100 on a PR News Subscription

cover5.18

 

Let PR News become your weekly, go-to resource for the latest PR trends, case studies and tip sheets. Topics covered include visual storytelling, social media, measurement, crisis management and media relations.

Use code “SUBDEAL” at checkout.

Comments are closed.