Thanks GM, That Leaves More Facebook Ads Impressions For Me

Red Camaro Picture

General Motors,  in a widely reported Facebook-IPO-week #Fail bail, has quit their social media agency of record and abandoned Facebook Ads.  We understand the former, but not the latter. The most common reason for Facebook Ads failure, or in any channel for that matter, is a serious misunderstanding of the channel.

Hey there Mr. and Ms. online marketer. What would YOU do with about 24 billion paid Facebook Ads impressions, served to the largest sampling of humans on earth with the end goal of selling GM cars? Would you target social ads broadly, run promotions, attempt to drive users to external landing pages for one-touch car-building conversions, gradually raise up a new generation of brand-friendly customers and/or socialize users for later marketing efforts? How tightly would you segment users? Would the campaigns be part of a deeper, multichannel and long term strategy?  Would you expect to sell cars after one, two or three direct response FB Ads touches?   Would the 10 million bucks be worth spending compared to less quantifiable buys like television ads, radio or print brochures? Would you track results holistically, shooting at appropriate KPIs after setting realistic expectations?   Well, if you’re General Motors, apparently the answer is none-of-the-above… no, no, no, no, and no (at least not anymore)!

As an agency, all hinges on our client’s willingness to look at appropriate long-term KPIs informed by predictive modeling on the front end, serious targeting grids, bleeding edge creative and analytics monitoring in a reasonable attribution model.   A good social media marketing agency FIGHTS for their clients at KPI setting time. Dude, it better be real. At very least, one must understand the implications of making a brand even more famous to laser-sharp demographics.

From brainwashing the next generation of consumers (in uplifting ways) to influencing the influencers, FB is replete with marketing opportunities for the informed creative social/search hybrid team…

We doubt GM had all those variables lined up prior to their eerily public and blatantly timed fail-bail from Big Fuel Interactive and Facebook Ads. Good for everyone else! After all, FB Ads are sold at auction. Fewer advertisers = more impressions, for less money, for marketers to leverage FB’s social targeting might.

Predictive Modeling
Assuming an average CTR, CPC, great targeting, bleeding edge creative and expecting extraordinarily low conversion for direct response car-selling here’s what the program may have looked like, run by a team that knows what they’re doing.

Even with the conversion rate cut in half from what we’ve modeled here, and excluding future cross-channel conversions (including new brand searches by SEO & PPC) tracked by multichannel attribution funnels, we’re still talking about selling lots of cars here. GM is quitting FB Ads? Hmmm.

Not everyone agrees with GM. A recent Forrester study concluded that Facebook fans are twice as likely to buy brands they ‘like.’ In Gina Sverdlov’s Market Insights Professionals Blog, she posted this infographic citing the propensity of impact of Facebook fans at buying time. Of course, every vertical is different. Cars are different than rakes or AppleTV.

Impact Of Facebook Times

It is interesting to note that the Forrester study was also publicized the very week of FB IPO Madness. Hmmm.  Do ya’ think that this IPO is open PR warfare?

A Like is basically a viral subscription, where brands can re-market to users once subscribed, at the same time as using Sponsored Stories (second degree of separation ads) to amplify marketing messages to users’ friends. Our data shows that FB, as a paid channel, usually yields fewer direct conversions at a higher cost than other channels. However, in harmony with other channels over time, the FB channel can be a blockbuster.

Direct response, that is selling cars directly as the immediate focus of an ad, is not the only way (or best way) to skin the Facebook ads marketing rat.  Wiring up legions of friends by providing incentive for them to like your brand can be highly effective.  There are many ways to use FB ads to procure users’ likes. THAT does not need to cost ten million bucks.

Let’s assume you have the likes. GM has over 300K users that like the GM brand, not a bad start.  Once a brand has users in-community then the marketing mission is about providing the community with meaningful discourse, valuable tools, content to demystify products and remove barriers to sales.  All of this activity can lead users down the future conversion path. The screen capture below shows Monday’s post on the GM brand page as an example of the creative they tender to fans in their community.

How can this type of messaging lead a community member down the conversion funnel path? Looking back over the GM FB content posting strategy (re-marketing to users who have liked), there are months of self-congratulatory rhetoric, posts of questionable value, and little or no engagement or reason for users to engage. Maybe GMs problem is not Facebook Ads.

GM leaving paid FB as a channel is good for everyone but G.M. Ultimately, or at least temporarily,  G.M.s bail will very slightly lower the cost of FB ads for our clients. We doubt it will slow the FB IPO freight train. It would be a surprise if G.M.s reallocation of the the ten million + agency fees will sell more cars than they would have priming the social pump with FB Ads.


Photo by © Anatoliy Meshkov – Fotolia


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