Tags: GM | Facebook | advertising | mobile

GM Returns to Facebook Advertising With Mobile-Only Ads

Tuesday, 09 April 2013 09:05 PM

General Motors Co., which cast a pall over Facebook Inc.’s initial public offering last year by announcing it would stop advertising on the social-networking service, said it’s restarting paid spots.

The test ads, which will run through Facebook’s mobile applications and mobile website, will promote the Chevrolet Sonic subcompact car, GM said Tuesday in an e-mailed statement. It’s part of a broader GM mobile-marketing effort.

GM announced in May that it would end promotions on Facebook, just as the company was preparing its IPO. The move highlighted investor concern that other large advertisers would reconsider the website. It also raised questions over the ad strategy of then-GM Chief Marketing Officer Joel Ewanick. The Detroit-based automaker spent $10 million on paid Facebook ads in 2011, a person familiar with the spending said last year.

“It shows one thing: Nobody can really ignore Facebook,” Thilo Koslowski, an auto industry analyst with Gartner Inc. based in San Jose, California, said in a telephone interview. “GM realizes there must be a value proposition for them to go to Facebook.”

The automaker’s U.S. ad spending declined 9 percent to $1.17 billion during the first three quarters of 2012 compared with the same period in 2011, according to Kantar Media. GM continued to have an unpaid presence on Facebook via pages for its brands.

Wooing GM

Facebook had made an effort to win back GM’s business with Chief Operating Officer Sheryl Sandberg talking with GM Chief Executive Officer Dan Akerson last year about resuming ads, people familiar with the discussion said at the time.

“We’ve had an ongoing dialogue with GM over the last twelve months and are pleased to have them back as an advertiser on Facebook,” Adam Isserlis, a spokesman for Menlo Park, California-based Facebook, said in an e-mailed statement. “We look forward to working even more closely with GM in the coming weeks and months.”

Facebook rolled out its mobile-advertising service in March 2012, trying to better monetize the growing number of users accessing the service through wireless devices. More than 60 percent of its 1.1 billion members use the service when they’re on smartphones and tablets, according to a regulatory filing.

By the fourth quarter of last year, mobile made up 23 percent of Facebook’s advertising revenue, up from 14 percent in the third quarter. Still, it lags Google Inc., which is projected to grab 57 percent of the U.S. market for mobile advertising in 2015, according to researcher EMarketer Inc.

“To Facebook’s credit, I think they also got better about understanding how to better target certain users and to get messages across in that way instead of being just a social network,” Koslowski said.

Undoing Ewanick

GM’s return to Facebook is just another move by GM’s marketing department to undo changes made by Ewanick, ousted as marketing chief in July over the cost of a sponsorship deal with the Manchester United soccer team, people familiar with the move said at the time.

GM in January replaced his Chevy Runs Deep tagline with Find New Roads and the company is looking at changing its advertising agency for Cadillac.

“Chevrolet is launching an industry-first ‘mobile-only’ pilot campaign for the Chevrolet Sonic that utilizes newly available targeting and measurement capabilities on Facebook,” Chris Perry, U.S. Chevrolet marketing vice president, said in Tuesday’s statement.

The structure of an ad agency set up to conduct Chevy’s advertising globally last year was also changed in March when Interpublic Group of Cos.’s McCann Worldgroup gained control of the joint venture called Commonwealth.

Along with ending GM’s paid advertising with Facebook, Ewanick also said the automaker wouldn’t advertise during this year’s National Football League’s Super Bowl championship game on CBS. Months after Ewanick’s departure, GM announced it would advertise during Super Bowl pre-game programming.

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General Motors, which cast a pall over Facebook's initial public offering last year by announcing it would stop advertising on the social-networking service, said it's restarting paid spots.
Tuesday, 09 April 2013 09:05 PM
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