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What's good for General Motors ...

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What a week Facebook founder Mark Zuckerberg had the middle of last month. On Friday of that week, his company had its long-anticipated, much-ballyhooed initial public offering, and on Saturday he got married. But it was Tuesday, the ides of May, that I'm most interested in. That was the day news broke that General Motors Co., the nation's third-largest advertiser, was dropping its Facebook advertising—at $10 million a year, not exactly small change. The nation's largest automaker, based on sales volume, said its advertising on the wildly popular social media site wasn't exactly prompting extensive tire-kicking. BtoB sibling Advertising Age said something else was at work—GM had been rebuffed in its efforts to run bigger, splashier ads on Facebook. So in this case, is what's good for General Motors good for America? I'd say no for two reasons. First, it's hard to ignore Facebook's 900 million-strong membership and the data available on those members, many of whom are employed at businesses that buy products and services from other businesses. Second, I expect that under shareholder pressure—its stock hasn't exactly been going gangbusters—Facebook will come around to offer more extensive and dynamic advertising options. Though the GM advertising at issue here was consumer-oriented, I still see a big future for b-to-b advertising on Facebook; and I'm not alone in seeing its potential. “Facebook offers advertising on a pay-per-click model. So on a cost basis, it is very low risk,” said Terry McDermott, media director at b-to-b agency Slack and Co. “It is also targetable based on "likes,' company affiliation and geography. While measurable results will determine if Facebook advertising is successful for any specific advertiser, it is a viable option simply because it is "testable' for many b-to-b advertisers; and it is testable at low cost.” McDermott gave this example: “Someone who "likes' Air & Space magazine, is affiliated with Boeing and (via ZIP code targeting) lives in Everett, Wash., is probably an appropriate target for a company producing commercial aircraft components.” One b-to-b marketer that has enjoyed considerable success with Facebook advertising is Hitachi Data Systems. In the wake of GM's announcement, HDS Integrated Marketing Manager Sharon Crost wrote in a BtoBlog post: “One of the key advantages I've found to marketing in social networks is audience targeting—using audience-defined profiles to help eliminate irrelevant ads. Facebook profiles provide demographic information that helps marketers avoid serving irrelevant ads.” Crost sees Facebook advertising as a work in progress. “We are not to the point in time where advertising experiences are perfectly optimized and the audience is only served ads on Facebook or other social networks that they are likely to enjoy and find relevant and informative. So in the short run, I'll still find myself seeing ads that I'll try my best to ignore. But as marketers pay attention to profiles and the types of ads that a specific audience clicks on, [they] can both invest their advertising dollars wisely and better respect their audience's time and space.” John Obrecht is editor of BtoB and Media Business. He can be reached at jobrecht@crain.com.
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