No Facebooking for GM
General Motors has removed all Facebook advertising with immediate effect. This is because the company does not feel that anyone has the interest to click on ads on the social network site, while these advertisements have little impact on customers. While this mode of advertising is looked upon as highly effective, General Motors think otherwise and this move could be looked upon as a crack in Facebook strategy.
Facebook is now in its 8th year of existence after being founded by Mark Zuckerberg from his Harvard dorm room. The social networking site now enters trading on Nasdaq from Friday and is the biggest social networking site with a valuation of more than $100 billion.
General Motors is not too sure if the money spent on this sort of advertising is worth the effort or whether it is better to stick to more traditional forms of advertising and hence have decided that though they will still have Facebook pages to market their vehicles, products and brands, but they will discontinue advertising. The company currently spends $40 million on its Facebook presence out of which only $10 million is paid to Facebook for advertising.
Mr Brian Wieser, Internet and media analyst at Pivotal Research Group, said, “While GM’s decision could be an exception in the advertising world, it marked the first highly visible crack in the Facebook strategy. This does highlight what we are arguing is the riskiness of the overall Facebook business model – it is not a sure thing. It sure looks likely that it will be one of the most important ad-supported media properties, but it’s not certain because there will be marketers who are challenged to prove the effectiveness of the marketing vehicle.”