GM unfriends Facebook … ouch.



According to the WSJ … GM is going to stop advertising on Facebook

General Motors plans to stop advertising on Facebook after the company’s marketing executives determined their paid ads had little impact on consumers’ car purchases.

GM will continue to expand its use of marketing through Facebook’s pages, in which marketers can display content at no cost

The news comes at a bad time for Facebook  which is expected to hold a historic initial public offering on Friday. Facebook executives have spent the last two weeks trying to convince investors that its advertising business makes it worthy of a $105 billion valuation.

GM, started to re-evaluate its Facebook strategy earlier this year after its marketing team began to question the effectiveness of the ads.

GM marketing executives met with Facebook managers to address concerns about the site’s effectiveness and left unconvinced advertising on the website made sense,.

GM spends about $40 million on its Facebook presence. About $10 million of that is paid to Facebook for advertising, the rest covers content created for the site,

Companies in industries from consumer electronics to financial services tell us they’re no longer sure Facebook is the best place to dedicate their social marketing budget — a shocking fact given the site’s dominance among users.”

Although GM’s $10 million worth of ad spend on Facebook won’t impact its $3.7 billion in revenue, the move is a disappointing development for the social network and could hurt if more big advertisers choose to follow suit.

“Disappointing and could hurt” … you think ?

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