Does GM Even Get Facebook? Or, Why Facebook Did GM A Favor

Oh, now I get it. It turns out that General Motors’ decision to pull out from Facebook advertising right before Facebook’s IPO was just a big hissy fit.

Ad Age reported this week that GM’s explanation that ads on Facebook were “ineffective” actually came down to this: it wanted to run big, splashy units that are completely out-of-sync with how advertising on Facebook works. And Facebook, knowing this, said it wouldn’t give in.

Even though neither GM or Facebook would comment on the Ad Age story, this new, updated report about GM’s pullout has all the signs of being accurate, because it has GM and Facebook  comporting themselves in exactly the way you’d figure, given the situation.

GM played the role of the deep-pocketed advertiser, who is used to its gargantuan ad budget getting it whatever it wants; Facebook stuck by the precepts outlined in its S1 -- which, if anyone at GM bothered to read it, clearly states that, even as a public company, Facebook would favor user experience over the short-term cash shoveled at it by advertisers that would make its quarterly numbers look better.

(I should stop at some point and mention that Facebook does have a big, splashy ad unit, the so-called Logout Experience, which takes over the closing page of Facebook on the off chance that one of its 900 million users should logout. OK, consider that mention done!)

Apparently, what GM had in mind was much more intrusive than the Logout Experience. It sounds like it had its collective mind all wrapped up in visions of the kind of ads you see when you log on to nytimes.com, only times traffic numbers nytimes.com can only dream about.

What’s completely lost in the discussion is this: that if GM really wanted to annoy people -- including its “Likers” -- the best way to do that was run a big, freakin’ ad on Facebook. Facebook really isn’t built for these kinds of ads, and never will be. It’s not what Facebook wants, and, more importantly, it’s not what users want. Even if Facebook was watching its own interests in declining to give GM bolder ad units, it actually ended up doing GM a huge favor.

Still, you have to feel a little sorry for poor GM. This skirmish between one of the world’s biggest advertisers and one of the world’s biggest platforms is really the story of how media has changed -- and for major advertisers, it isn’t for the better. Once able to gather tens of millions of eyeballs at the writing of a check, the GMs of the world now finds themselves in a place where that same check doesn’t buy as many eyeballs.

And then along comes Facebook, a gold mine of a property closing in on one billion users, as other audiences shrink. If GM could just do what it has done with previous platforms, the good old days would be back -- even if all Facebook would allow GM to do is advertise to its base of Facebook “Likers” -- who would then, surely, spread the word.

But Facebook, as big as it is, is also a symbol of how, as media consumers, we’ve moved on from mass consumption. We may all be spending inordinate amounts of time on it, but our experiences on Facebook are customized, and our tolerance for intrusive advertising on it is low. Facebook knows this. It sounds like GM doesn’t.

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5 comments about "Does GM Even Get Facebook? Or, Why Facebook Did GM A Favor ".
  1. Mark Smith from Sevencamp , May 30, 2012 at 7:41 p.m.
    I don't see how you can say GM doesn't get facebook. GM understands where its ad dollars can be effective and Facebook cannot demonstrate that they can be effective on their platform. To this point I quote you .. 'our tolerance for intrusive advertising on it is low'. Maybe - Facebook stock will be a buy at $10-$15 a share and that's because of what GM understands.
  2. Jay Davis from -------- , May 30, 2012 at 8:23 p.m.
    Geez, hate cars much? A company dares stand up to your crush, Facebook, and suddenly you spend an entire post trying (unsuccessfully) to rip them over it. Oooooo, yes, the EVIL GM did the unthinkable!! They stopped pissing money away!!! Now I must level the ultimate "we're hip and you're not" insult at their marketinghood: they don't GET it, 'cause, you know, they're not cool. Like me. And my friends who live to over share. Didja ever, EVER stop to think that maybe Facebook just kind of sucks for marketing? Of course not. Because then Facebook probably wouldn't ask you to the prom. And I'm sure you have a handful of poorly vetted case studies of marketers that think they might have made money on a FB presence somehow (although money is just so 1%, doncha think?), but in truth, most of us that have actually used it, when forced at gunpoint, will admit that FB isn't a platform for that at all. GM just happens to have a monster budget that people actually notice when it goes away. But judging from FB's most recent earnings, lots of others are figuring it out too. You try to make GM the Goliath and FB the David, but in truth, FB is the emperor, and Zuck has no clothes. Where's the growth? Or are you going to keep saying that everyone "doesn't get it" until FB either dies or creates big splashy ad units?
  3. Richard Truesdell from Automotive Traveler , May 30, 2012 at 9:19 p.m.
    Catherine, I hate to say but it's you that doesn't get it. GM, with its budget did what it thought was in its best interest, and pulled its Facebook paid advertising. That the Facebook IPO collapsed under its own over-hyped weight from Wall Street underwriters and the likes of cheerleaders like CNBC must to have been sweet to GM's marketing people. And if you think that I'm some Johnny-come-lately on this -- piling on Facebook -- I posted much the same thing on a UK-based automotive web site on 27 May (http://bit.ly/NgCGH2) and in an op-ed piece on my own website, Automotive Traveler (http://bit.ly/KyzRSj) on the 17th, the day before the Facebook IPO. While Facebook claims they have 900,000,000 users, many log in infrequently and there's very little evidence that Facebook "moves the metal." I'm not even sure if it has much value in building brands. As Facebook's stock heads south -- I think it will settle somewhere below $20, which is where the IPO should have been priced, based on the fundamentals -- many people will ask the same thing I did BEFORE the IPO, "will Facebook be the next Google or the next MySpace?" If the last two weeks are any indication, we have the answer. And a year from now, how will we look at this? Will Ford, which well and truly believes in all this social media nonsense, quietly pulls back from its unqualified support for Facebook and puts its marketing eggs in another platform?
  4. Cathy Taylor from MediaPost , May 30, 2012 at 9:58 p.m.
    Well, it's a trifecta. I think all three of you didn't get my point. If you've been reading my stuff for the past few years, you'll see that I have my own doubts about Facebook's ad model. Just last week, in fact, I wrote that it's unproven as an ad model and that the meh IPO shouldn't be surprising to anyone who has been following what the company has been doing. The party ain't over, but if Facebook is going to succeed at advertising, it's going to be a slow build, because Facebook will never have an easy to understand ad model, as Google's is. So what doesn't GM get? As stated in paragraph #4, it doesn't get that Facebook has been pretty clear that it will not go for ads that it feels wreck the user experience, so it's kind of obvious that it would turn down the opportunity to do splashy ads, even when the advertiser is GM. Users, meanwhile, who want their Facebook experience without intrusive ads, would have hammered GM for ruining their experience. That doesn't make Facebook, or users, right, by the way, but it does show that GM doesn't get the Facebook mindset. Thanks for commenting, Cathy
  5. Robert Gilmour from Innfinite Hospitality Ltd , May 31, 2012 at 4:28 p.m.
    This post is a total insult to GM, and a ridiculous testimonial/compliment (of whcih there a '000's out there from the Facebook 'evangelists') for Facebook. Facebook is getting found out, that's the reality. The fantasy world of Facebook ended a week past Monday when investors and their expert advisors took over - the skeletons then simply walked out of the cupboard. Lets get real, and face facts