Should You Bag Your Facebook Advertising?

Back to Blog Posted on May 16, 2012 by katieadams1

Just days before Facebook’s scheduled $100 billion IPO one of the largest U.S. manufacturers has dropped all of its paid advertising on the social media site. GM made the decision to axe its $10 million advertising budget based on findings that paid ads on the site “had little impact on consumers.” Before rushing to join the crowd suspect of the relevance of social media, it’s important to note what the car giant said about how they plan to continue interacting with Facebook users. According to a Wall Street Journal article GM marketing chief Joel Ewanick said that GM is “reassessing our advertising on Facebook, although the content is effective and important.”

Did you catch that? “Content is effective and important.”

As chief marketing officers grapple with continued tight budgets and increasing demand for ROI it’s worth examining how you’re using social media as a marketing tool. First, focus on the main reason people use Facebook in the first place. According to the study “Why Do People Use Facebook?” by Boston University researchers Ashwinin Nadkarni and Stefan G. Hoffman, the two primary needs that Facebook satisfies for its nearly 1 billion users are (1) the need to belong and (2) the need for self-presentation. Conversely that means that Facebook is not viewed by the majority of its users as a way to find or buy services or products. So it stands to reason that if you are purchasing ad space on the social media site as a way of quickly generating sales you may be disappointed. The question isn’t if Facebook is effective as a marketing tool, it’s how is Facebook MOST effective? Are you using the platform to its best marketing objective? GM has chosen to maintain its Facebook presence because it provides a powerful way to engage with customers and influencers as well as to have a pivotal presence in conversations about the industry and its own brand. But the company is aware that it can do that solely by providing CONTENT, not by purchasing paid ad space.

While GM’s decision may have prospective Facebook shareholders concerned it should be welcomed by chief marketing officers. GM’s insight should give you pause about your own organization’s position on Facebook as a marketing tool. If the two primary motivators for Facebook users are to belong and to be able to share personal stories and opinions (“self-presentation”) what types of material are you giving them to be able to do just that? Are you creating an engaging community for users? Are you sharing content — information, tips, and tools that they can use and share with others for free? Are you customizing your content so that you are one perceived as a highly relevant voice in their social media world?

Despite the contrarians Facebook isn’t going anywhere. The question is where are you going with Facebook?

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