TweakTown
Tech content trusted by users in North America and around the world
5,677 Reviews & Articles | 36,088 News Posts
Weekly Giveaway: Fractal Design Arc Cases Contest (Global Entry!)

GM to stop advertising on Facebook saying it doesn't work

GM is pulling $10 million in advertising from Facebook after deciding it isn't worth the money.

| Internet & Websites News | Posted: May 15, 2012 10:31 pm

GM has announced that they will be pulling $10 million in ads from Facebook as they say they don't work. This comes at a bad time for Facebook as they are about to launch their IPO. GM's marketing executive have apparently been reviewing GM's advertising and found that the paid ads are worth the money. They will, however, continue to use the free advertising on Facebook.

 

TweakTown image news/2/4/24113_1_gm_to_stop_advertising_on_facebook_saying_it_doesn_t_work.jpg

 

GM currently spends somewhere in the neighborhood of $40million on Facebook advertising, though only $10 million of that goes to paid Facebook ads. (These are presumably annual figures) The other $30 million goes to upkeep on the company's Facebook page, along with paying for promotions and giveaways which don't appear to make Facebook any money.

 

This $10 million isn't much in terms of the $3.7 billion that Facebook brought in last year in advertising. However, GM is the third largest advertiser in the United States, so the fact of them pulling their advertising may cause other companies to reexamine their strategies to see if Facebook is really worth it.

 

Business Insider's Jim Edwards points out that Facebook has a much lower clickthrough rate than Google does. This could be due to the different medium that Google is compared to Facebook:

 

The other issue is whether Facebook is right for all advertisers. Search advertising -- the kind Google provides -- tends to be more effective on customers who are actively doing pre-purchase research. Facebook, on the other hand, is more of an entertainment medium; no one is shopping for cars on Facebook -- a fact GM seems to have now learned.

NEWS SOURCE
News.cnet.com

Related Tags

Further Reading: Read and find more Internet & Websites news at our Internet & Websites news index page.

Do you get our news RSS feed? Get It!

Post a Comment about this news

Latest Tech News Posts

View More News Posts

Latest Downloads

View More Latest Downloads

TweakTown Web Poll

Question: Did EA kill the Battlefield franchise with the terrible BF4 issues?

Yes, Battlefield is doomed

No, Battlefield will live on strong

I'm not sure, but I know EA needs to improve its game

or View the Results

View More Polls

Forum Activity

View More Forum Posts

Press Releases

View More Press Releases
Get TweakTown updates via Facebook!
Just click the "Like" button below