General Motors cuts Facebook ads but adds content

Do paid advertisements on Facebook work? General Motors says no. The American car company is getting ready to stop advertising on Facebook just when the social media giant is getting ready to sell shares in an initial public offering.

Last year, GM spent $10 million on Facebook advertisements but it is only a fraction of the company’s $1.8 billion US ad spending. The amount only makes up a small share of the social media’s total income of $3.7 billion,  most of which comes from ad revenue.

Wall Street Journal quoted Joel Ewanick, GM’s marketing chief, in saying that the car manufacturer “is definitely reassessing our advertising on Facebook, although content is effective and important.” This means that GM will not be pulling out of Facebook completely.

The Detroit-based carmaker invests about $30 million on content for the company’s Facebook page. In fact, in the wake of the news, GM has posted on their page saying:

Just wanted to let our millions of Facebook fans know, we’re still here, and we ‘like’ you back! We may not be advertising on Facebook at the moment but we’ll still be talking with you all daily. If anything, we will be providing more content across our many GM Facebook pages – including Chevrolet, Buick, GMC and Cadillac - to keep the dialogue going.

General Motors is not the only one with doubts. Kia is also unclear how Facebook ads can help direct traffic into its dealerships. However, Subaru is sticking to their guns and will continue to advertise on Facebook. “If the return on investment is there, we will spend more next year,” said Dean Evans, chief marketing officer for Subaru of America.

Source: The Wall Street Journal, GM Facebook page

© 2012 Paul Tan's Automotive News. All Rights Reserved.

This story originally appeared on Paul Tan's Automotive News on Thu, 17 May 12 04:04:53 +0000.

Related posts:

1. Mitsubishi Motors Thailand to export the Mirage to Japan
2. Audi Q5 gets mid-life updates, adds hybrid to the range
3. Infiniti adds hybrid M35h and entry M25 to its local lineup
4. Infiniti’s Geneva-bound electric sports car concept to showcase new style and content direction for brand
5. MINI USA adds yummy Recaro seats to the option list
6. F30 BMW 3-Series to get world debut on Facebook
7. General Motors opens new diesel engine plant in Thailand
8. New car brand to be born in Frankfurt – Eterniti Motors
9. Honda cuts off slow selling Crosstour from Accord family
10. Toyota adds two new members to its crash dummy family

Link to full article