By dumping Facebook, GM’s doing it wrong
GM made a huge stink last week when they pulled their $10 million Facebook advertising budget.
They’re doing it wrong. And you can learn some valuable lessons from their mistake:
Facebook is the best display advertising deal on the internet
The Register pointed out that Facebook ads average a .05% click-through rate. Click-through rate is the total number of clicks on an ad, divided by the number of ad views, or impressions. That’s very low, compared to .4% on Google’s Display Network.
But you can purchase ads on both networks on a cost-per-click basis: You only pay if someone actually clicks on the ad. If a GM ad shows up on my Facebook page, and I glance at it but move on, GM doesn’t pay a thing. But I still saw GM’s ad. It’s free display advertising!
There’s no way to pin a value on that glance, but there is a value. If nothing else, GM just occupied attention otherwise available for Toyota.
Managed correctly, Facebook advertising is an unbeatable display ad bargain. GM’s losing a huge branding opportunity.
Understand earned media
Social media is earned media. Selling in earned media is a two-step process:
- Attract and build an audience over time.
- Then you sell to that audience.
Facebook ads boost step 1.
GM claims Facebook ads aren’t delivering results. But they’re measuring the wrong results, I’ll bet: They’re looking at clicks, sales and web site traffic. They should be looking at new followers, share of voice, and the quality of the following they build.
You can grow your brand without paid Facebook ads, by posting to your Facebook page. In our tests, 2-4 great posts per day is the minimum effective pace for a major brand. Post less often and your brand shrinks. General Motors posts every 1-2 days, at best. With that pace, and without ads, they can’t grow their brand.
Don’t repeat their mistake: Understand earned media. Your Facebook following is a long-term asset. It’s a community that’s primed for your marketing message. Neglect it and you’ll fail. GM has to either maintain their ad spend (clearly they won’t) or step up their other efforts (hopefully they will). As it stands now, when GM stops their ad campaign, their Facebook page will stagnate.
Learn to measure earned media
You can measure the return from earned media on Facebook. Run Facebook-specific offers. GM could run a regional campaign with participating dealers and offer cash back, or free oil changes for 3 years, or similar. See how many people participate. Use the performance of those campaigns over time to track the value of your average Facebook follower.
That’s only part of the value generated, but it’s a start. It lets you sketch out a comparison of ‘good’ versus ‘bad’ ads, content and offers.
Learn to measure earned media performance.
Don’t amputate for a hangnail
$10 million is a huge Facebook spend. Chances are, GM can optimize it and improve performance, or reduce waste by removing non-performing ads and segments. Instead, they’re chucking the entire budget baby out with the bathwater. If GM applied the budgeting technique to print and television, they’d shut down those campaigns, too.
If you manage a Facebook campaign, you’ll hit a point where you want to turn it off. Don’t. Instead, test, refine and improve. Use Facebook’s amazing segmenting tools to create precisely-targeted ads.
Don’t hack off a limb because of a hangnail. That’s what GM is doing.
Keep perspective
Facebook ads represent .5% of GM’s total marketing budget. To be worthwhile, Facebook ads would need to generate 45,000 cars sold. Staggering numbers for you and I, but for a company that sold 9 million cars last year, that’s a totally achievable goal.
My last advice: Don’t shut down an ad spend that’s less than 1% of your budget unless you’re 100% certain it’s a failure. When the stakes are low and the potential high, keep perspective. Bottom line, that’s what GM forgot to do, and it’s going to hurt them a lot more than Facebook in the long run.
Aargh. Ian, I normally really enjoy your stuff, but this is the type of stuff that really irks me.
"GM's doing it wrong by dumping Facebook"?
"GM claims Facebook ads aren’t delivering results. But they’re measuring the wrong results, I’ll bet: They’re looking at clicks, sales and web site traffic. They should be looking at new followers, share of voice, and the quality of the following they build."?
C'mon folks, it's time we step back from jumping onto events like this. Without being in the team, without the access to all the internal data, you simply don't have enough info to make the call that this was the wrong decision. Speaking as someone who's had to make some tough calls in social campaigns before and had to endure wild speculation, I've said it before and I'll say it again: cut it out. Unless you're on the inside, all you're doing is wildly speculating.
Agreed. Also, I pulled our ads for one of our companies 2 months ago. It's all about conversions and for whatever reason I was getting about 25% of the conversions of our Adwords campaigns.
May try it again for some of our more local businesses though.
Couldn’t agree more! How you can measure the goal conversion rate or ROI in GM's case? If someone spending time on website doesn't mean he/she wants to buy a car in urgent. GM can engage with public through Facebook and can bring the awareness about the feaures that they are providing. Facebook can become a medium for a company or brand through which they can say to people that if you want to buy something buy it from us because we are giving so and so benefits to you. Suppose if someone is aware and engaged with GM, then if he/she wants to buy a new car in future definitely will look at GM once. Still there is no guarantee of selling.
I am not saying that GM has done wrong. There must be a reason behind this, but they surly miss a huge crowd available on Facebook.
Could not agree more - It is about strategy, as others say above this could be part of a larger strategy.
Also, as much as I like Facebook - we did not need another tech bubble of neverending share rises, on products that do not exisit....
Large corps pulling their ads helps to not fuel the artificial inflation of stocks that only benefits those who know how to work the market, while tanking anyone naive enough to sink their live savings into a "bubble product" (anywho)
Defintily agree with Burgo - Poster is speculating, just as much as GM is speculating, although they have more data on their own business plan than you/we do!
:)
couldn't agree more. for such huge ads it would be a guesssing game only to say why for exact for an outsider. Also worth noticing is GM pulled out completely rather than adjust the budget or change Facebook ad strategy. Obviously they must have done more than testing for that. Also if we consider the Facebook pages of GM and its brands such as Chevrolet or Cadillac, each with over a million users, you are talking about huge fanbase that GM can reach for, well free.
You have your point and I agree with you! But the article was interesting, for example I didn't know about the click-through rate data..
Agreed - there are a lot of assumptions being made here. Platforms perform differently across industries and even within the same industry. I have no problem with them cutting the entire campaign. If I had two cars and felt my mechanic was ripping me off, I wouldn't keep bringing one of my cars to the old mechanic and bring the other to a new mechanic - I'd stop doing business completely with the old mechanic.
This post was written to create controversy. Marketing 101. No such thing as bad press, blah, blah, blah...
Just as GM recieved "negative" press for pulling the Facebook campaign, Ian is experiencing the same increase in mentions/views by writing this speculative post.
It's very possible Ian doesn't actually believe a word of the post he authored.
Well done, Ian.
Yeaaahhhhhh no. I actually do believe GM made a huge mistake. Although it's not a bad idea. Hmmmm. My next post:
GOOGLE IS DUM FOR FITING SPAM LINKSES
I'll just join the chorus of agreement with you Burgo.
I think GM is smart enough to consult their analysts (which i assumed to be top notch) before making such a big decision. $10 million is a huge money.
"Facebook is the best display advertising deal on the internet"
I have to disagree with this statement. It all depends on your niche and target market. Some businesses generate lot of sales/conversions while others don't (no matter what they do). I take various studies which report averages with a pinch of salt. Their averages depends upon their sample size (which is usually too small to prove a hypothesis).
There is a common misconception that viewing of a page = viewing of an ad (known as impression). Although technically this is correct. But in reality this is rarely the case. Many people are/have become blind to ads on display networks like Facebook. You never really know how many people actually looked at your ad. So even 1 or 2 million impressions may not justify spending huge money in the name of branding (which may be more virtual than you think). So in case of Facebook it is wise to look at clicks, conversions, sales and website traffic. Without measuring these metrics you will never know whether you are building influence with your customer base or with random people on facebook. So taking marketing decisions on the basis of number of followers and quality of following will not produce optimal results and is not recommended.
One lesson that we all can learn from this case study, is to do your own test and take business decisions on the basis of what works for your business and not what worked or not worked for a third party. Cheers!
Then why wouldn't they try sponsored stories? Or something else?
The first indication to me that GM did not consult their analysts is the fact that they simply shut down a $10m buy. Any marketer worth the oxygen they breathe would have suggested reducing the spend, not chopping it all off.
And then there's the fact that they post an average of just under once/day. They clearly don't get it.
I totally get what you're saying about Facebook as a display medium. It faces all the same challenges as any other display channel. But their ads are awfully effective. And given what I've seen of GM's current Facebook strategy, they aren't even close to exploiting it fully.
Your statistical inference is based on observational data (and that too as an outsider) which is prone to errors. As Burgo said in the comments below, unless you are an insider with real solid data in hand, you can't prove any hypothesis.
Great comment SEOTakeaways. Facebook display ads might be the best deal for one company and not for another. There is nothing that works 100% of the time for 100% of companies. I'm sure GM is smart enough to have the research and know what they are doing with a huge amount of spend like this.
I bet the person that decided to pull the $10 Million was just upset about having to use the Facebook Timeline.
Haha! That is definitely possible. ;)
I'm sure he is part of the 75+% of ALL FB users that hate Timeline.
I'm sure the PR generated from shutting down the campaigns has only served to increase their share of voice overall.
Perhaps some people will notice their ads just that little bit more if they turn them on in the near future.
Exactly what I was going to say @magicrob.
This has been covered by every major news outlet across the world (and it just happened to coincide with the Facebook IPO for MAXIMUM news coverage).
This is more about brilliant PR than Facebook Ads not working.
Everything I would say has already been said - would love to see how they set the campaign up in the first place though :)
Target: Everyone
Ad Copy: x1
:)
I was thinking this too. Timed nicely with the Facebook IPO being in the news everywhere so GM benefitted from the extra news coverage. I'm going to assume it was planned well instead of just a coincidence.
Sorry, but I have to disagree with the article - there's far too many leaps of logic which lead to conclusions that aren't neccesarily true.
Firstly, even if the Facebook campaign was making them huge amounts of money, maybe the CPA was lower through another channel - if that's true then doesn't it make sense to dump it in to the lowest CPA channel?
You said that if you post less than 2-4 times a day your brand presence will shrink. That's simply not a statement that can be sweepingly applied to all brands - there are a lot of brands out there posting less than this who enjoy a large engagement rate.
Your argument that Facebook is the best display channel because the click-through-rate is so low also, to me, doesn't stack up. It assumes that everyone is viewing the advert and then choosing not to click-through rather than displaying advertising blindness. There's a big difference between someone who's read an advert and chooses not to click on it versus someone who's never even spotted that the advert exists. Considering most people on Facebook aren't in a 'buy mode' the idea that most just don't notice the advert at all is highly credible.
In the end of the day, fluffy ideas of 'share of voice' are nice, but any marketing director is answerable to a manager who'll care about the bottom line. A business is there to make profitable sales - if they can't show how a marketing channel is contributing to that (or will contribute to that) then it's a bad investment.
Sorry to sound so negative, but as an industry we need to be making decisions based off of hard data - leading us to campaigns that drive ROI. Without it, we all end up looking like the snake-oil salesmen traditional marketing tries to paint us as.
OK, fair enough.
But how exactly does GM dump their Facebook buy and continue spending big, sticky gobs of money on television, then? Or on print?
I'd imagine like most big organisations their offline and online marketing budgets are competely seperate and controlled by different people - so for the budget holders it's not a choice between one or the other.
We don't know what their ROI on their TV adverts is in any case - maybe, for GM, it's better than for Facebook? Maybe they decided to move the budget to help increase their content marketing spend. Maybe they're going to decrease their TV spend too. We just don't know.
We do know that GM reps met with Facebook to try to solve their issues before pulling the budget; implying that they tried to make Facebook adverts work for them, but couldn't. I don't like to use words like 'implying' though, because guess work often leads to mistakes. The point about all of this is that we just don't have enough data to draw meaningful conclusions.
We know that Facebook told GM distributing their Facebook ad buy among several agencies was a mistake. Which is obvious enough to me. Sounds to me like they did try to make Facebook ads work. They just didn't try hard enough.
I agree that this article is a bit speculative. But my arguments have already been mentions by other people. So I am not going to repeat them if that's ok.
Regarding your question. Well it simple could be a matter of RIO, or some other plan. Only GM knows for sure. So nobody can answer that question and we all can only speculate.
My own experience and speculation on the subject. It could come down to believe. If you work at a company who does not see the power, advantage and or believes in a medium that will be reflexted via the medium. Simply put what use are followers if you are not interacting with them. Do you want to invest money in a possibility of a potetional click or in something which you believe and know to have had success in the past. That is in my experience how most CEO;s look at things. And fair is fair they aren't always correct. But that's a completly different story.
Well, to be fair, this was one piece of a larger marketing shake-up at GM. For example a couple of days after this, they announced that they were no longer buying Super Bowl Ads.
I do not agree that Facebook is the best deal in the market currently, I mean you have have many independant networks and also established networks which offer far cheaper abnd sucessfull ROI, Facebook is quite picked over in some niches.
In regards to did GM make a mistake, one of the best posts I have seen on this issue does to Aim Clear they break donw some ROI estimations from the spend - https://www.aimclearblog.com/2012/05/16/thanks-gm-that-leaves-more-facebook-ads-impressions-for-me/
The idea that GM would pay for display ads to get impressions hardly marks up the value of putting their ad up there. The reality is that Facebook is not targeted marketing - one of the reasons the company is overrated. Only certain things that are very social and viral mesh well with Facebook - such as movies, beer and sports.
The other thing is to consider that Facebook doesn't have the same click fraud detection as Google's Adwords program.
Even if you would get display ads on the Google ad network or Microsoft ad network, you would get more targeted display ads - with you ads appearing based on on-page text.
A click from Facebook has less value than a click from a PPC or even a PPC Display ad on a targeted website. Also, you have to have someone manage the campaign - especially if its a multi-million dollar one.
I don't see this as being a bad move by GM.
2-4 posts a day from GM on my FB feed? No thanks. That's a great way to get me to unlike them.
It's all about the targeting. Facebook lets you target posts, yes?
So you send more posts per day to the folks who interact with you the most. Fewer posts per day to the folks who just hang around.
Hey Ian,
(First off... looks like this whole comment thread turned into a bit of a swamp. Apologies if my comment was one of the ones that came off as overly harsh.)
Hesitant as I am to kick this up again, I have to add that re: targeting, yes, Facebook lets you target your wall posts... by location/language. Likelihood is that for most businesses, that won't be grnaular enough to target just those who interact with you the most, as that would be more based around demographic rather than location/language.
I'm old. I have seen a lot of brands over years and very few (if any) are stronger than GM's. A name like Chevrolet needs no introduction to the automotive marketplace.
Facebook marketing is not one size fits all. Is it so difficult to believe that after considered research and thought that GM came to the correct conclusion that its ROI can be improved by other advertising means?
In 2009 they got $50B from taxpayers to keep their brand alive. Then they cut a deal to pay neglible taxes for the next 5-10 years. In 2011 GM lost $750M in Europe. And the GM pension has a shortfall of at least $24B. Curious what you think makes GM a strong brand? I see incompetence and poor decision-making with GM, so why would it surprise anybody that GM may have possibly made a poor marketing decision by pulling their FB ads because they incompetently managed them?
Well, I would look at it this way: In the course of your lifetime, when was the last time you were not aware of GM as a brand? A strong brand is not defined by a profitable bottom line. An iconic brand does not guarantee success, just look at Kodak.
As far as the GM bailout goes, the huge brand awareness GM wields was a huge factor in their receiving government finacial aid. The phrase "too big to fail" was constantly be thrown out in defense of the GM bailout.
I would argue the GM bailout is perhaps the best example of what a strong brand can do for a grossly mismanaged company.
Compliments to GM, maybe they just learned that they do not want to waste money anymore!
I don’t want to compare Online-Ads to Traditional ads as the differences are obvious and there is a reason why Newspapers and Magazines are having such difficulties. But:
In my opinion Facebook is not the right environment for efficient Advertisement! People are not using Facebook to get information on products, but just to hang out. Comparing to Google the Users disposition to buy is much lower. Ads on Facebook are not part of a solution to a current problem the user has. But just an add that could be related to some interest the user hast, does he want to follow that interest now? Just if he posts about it. How long will people continue posting everything going on in their Brain?
Is Facebook a Good environment for Branding? I don’t know I cannot measure it. But I doubt, people’s attention is not on the ads but on other people. Again, ads in Facebook are not potential solution to current problems like they are in Google.
I am thinking about reducing my Facebook budget as well. Not because GM is doing it but because the numbers I get are giving me that advice. Which does not mean that I stop caring about my community, I like them and it is a great way of communication. But i Woll not Spamm my "Fans". I just don’t like spending Money on Facebook adds…
We all have been spoiled by Google money printing machine Adwords and the easy way of measuring the ROI, so that it will be very difficult for other Advertisement models. In my opinion Facebook has to find another business model then Just advertisement, the current one will not work in long term.
Maybe Facebook is made a bit to Big at the moment!
Not sure on the point being made here. Facebook is great for earned media, as outlined in this post. GM is not disagreeing with you - they just don't think they need to supplement it with paid media.
The only point here that refutes their stance is the notion that Facebook provides value via low cost clicks. This is correct in terms of low click cost but it usually also means low value visitors (low conversion to whatever goal you're after, low value customers when they do convert, low time on site, low return visits etc). Don't think its wise to focus on cost-per-click to evaluate ad channel performance (otherwise we'd all just use Stumbleupon ;-)).
Would be more interesting to see more research on this - my view is that Facebook would provide more cost per conversion info if it supported their notion of ad ROI.
It really feels to me like GM's missing a huge opportunity. Facebook ads are so targetable - it's hard to believe they don't pay off for GM.
We see a cost of $.30-.50/like with a moderately successful Facebook ad campaign. Even the directly measurable ROI is usually well worth it at that price. And that ignores the ancillary benefits of what amounts to free display advertising.
GM wishes they were as successful as FORD is so many different ways...including FB Advertising
https://www.facebook-successstories.com/ford/
GM have done the same mistake a lot of other companies do. But I still don't blame them, putting a value on social media is difficult enough.
It's all about the culture of the company, they were clearly not adapted to the Facebook 'scene' and did not know how to converse and connect with their audience appropriately.
In a sentence, they are outdated and not up-to-date.
K folks, clearly I stirred up a hornet's nest.
Sorry if you don't like the post. You've thrown your eggs, tarred and feathered me, etc.
I shall retire to the corner of the room. Back with another post next time, I'm sure.
Ian, you are entitled to your opinion and well done for voicing it while many of us hide away. Perhaps a little of us (myself included) were a little harsh.
Cudos to you for taking it in your stride. I look forward to your next post.
Ian, my client's don't gave a damn about anything unless it puts money into their bank accounts. I cannot justify taking money from their Adwords accounts and applying it to Facebook. Yes social media is important, but when I have a 22% conversion ratio (lead) on Adwords, "I" think Google brings in way more money that Facebook.
For my clients, it's about money in the bank. That may sound shallow, but they aren't paying me to get Facebook Likes.
Craigslist brings in more business than Facebook for us and we're on a national and international level; not just local.
I'm totally there with you - I get it, and I agree.
I actually gave an example of measuring the value of a Facebook like in the article. But you do it like this:
You can calculate it. If the math doesn't work and you can't justify it, that's fine. I'm not suggesting otherwise. All I'm saying is do the math. And it boggles the mind that any math GM could've seen - anything - could have justified going from $10m to zero in a single stroke. If they couldn't get at least $10m in value from a $10m ad buy on Facebook, their agencies were completely bolluxed.
I agree with the others who think it ultimately comes down to campaign perfromance. The true measure of any ad campaign is the satisfaction of the poeple writing the checks.
I happen to strongly disagree with this article. For us smaller companies (the Non-GM's of the world) there's no real new brand awareness created on an advertisement that people don't click on. And on the other side of that coin, FB has yet to prove its ability to convert users (who are there to socialize) into impulse buyers for your product. If you want a million people to see your company's name and message, and then just a small handful to actually click on the ad, then yes, FB might be a really cheap way to go. But then again, what's the point?
Have to agree with modernfurn. Brand awareness is just not something that we're going to be able to get in a large audience of millions of people right now. So, it's not a metric we're interested in.
Oh, and if you've commented on four posts in your entire membership on SEOMOZ, with 12 MozPoints, calling this the "most annoying post you've ever read" lacks a certain... credibility?
I read SEOmoz on my phone via RSS daily so don't usually comment.
To me, the term "branding" is a convenient way to label advertising where an accurate ROI cannot be calculated. I agree that there is not enough data published regarding GM's Facebook Advertising to draw any clear conclusions one way or another. Everyone is just speculating. Although, last year when I was looking around the Internet for articles on Facebook advertising ROI, any article that was eluding to Facebook advertising being "good" had very little if any "real" data - including the article published here. There are quite a few companies (other than Facebook) that stand to profit from managing Facebook advertising campaigns. Heck, just the other day we were looking at shopping comparison engine traffic and found a ton of hits from Facebook via Pricegrabber which strangely were resulting in NO conversions. And these were the same products that were converting on other networks with the same ads.
So I can speak from my own experience managing ad campaigns for several retail companies on a wide variety of platforms (AdWords, Bing, Yahoo, FaceBook, DoubleClick, etc. etc.) And in all cases the ROI on Facebook display advertising was dismal in comparison to the other networks, especially Google Adwords. This seems logical considering the mindset the majority of users are in when they access Facebook - they aren't shopping. In my opinion this is also one of the major reasons their IPO faultered a bit.
The important point though is no company's budget is unlimited. It seems the flaw in the arguement that GM made a mistake is that it would assume the $10M was removed from the entire advertising budget completely. I would think this decision was just about spending the $10M somewhere else with a higher ROI. Unless you can measure ROI, accurately and reliably, you really have no idea whether you are wasting your money or not. I bet they had pretty convincing data the money was better spent elsewhere. Facebook has a HUGE uphill (and possibly impposible) battle to compete with Google on gaining a larger chunk of any company's advertising budget.
Coudln't agree more. I actually think we will see a lot of advertisers begin to realise thier not making a return on Facebook ads and follow suit with GM.
Does this mean that the platform is useless? No, but I think it's hugely overrated and when the buzz dies down Facebook is going to need to innovate fast.
Maybe it's me and I just don't get it or companies aren't "doing it right" but either way, this post offered no useful Facebook marketing lessons.
Seems that with the budget they have its more of a matter of not knowing how to handle things appropriately. In some cases the pain may be worse then the gain and whats not considered here is the risk of a poorly managed campaign.
For a company that had US$150bn revenue in 2011, I think they had their reasons to shut off a $10m marketing campaign.
This is all wild speculating - you don't think GM had a vastly experienced team of consultants working on this? We don't know their inner operations and can't pretend to.
Furthermore, the fact that some of you in this thread are suggesting you hold social PPC to the same ROI standards as your search PPC account is absurd.
Audience building through interest targeting (Facebook) vs. lead gen through search queries (AdWords) is not even an apples and oranges comparison. It's a mars and venus comparison. Don't expect them to work the same way.
I completely disagree. Facebook was the worst investment we have ever made in 2011. It was impossible to get any "Facebook page fans" to see our posts only until Facebook finally made another change in 2012. And what about the new "Promote this post" feature? It's extremely expensive ($5/CPM rate) and it doesn't really work.
Let's just put it this way...advertiser retention is going to be a huge challenge for Facebook.
Sorry if this comes across overly critical, but this is perhaps one of the most annoying, poorly thought out posts I have ever read on SEOmoz and I would go as far as saying that it contains a lot of plain bad advice.
You are claiming that a multi billion dollar car company is "Doing it Wrong" - on what basis? This is an incredibly arrogrant viewpoint to take for someone who has absolutely ZERO data on the performance of their campaign and yet you are making so many assumptions.
Any figures and statistics on conversion rates are essetially complete guesses and nothing else. So don't assume that they aren't looking at their data properly or try and invent figures to justify your argument.
Secondly, you are making these wild assumptions about the number of Facebook posts required to "grow your brand". What does that really mean in this context? Facebook Likes? Twitter Followers? On that logic then lolcats would probably be considered a bigger brand than most blue chips. It's completly ridiclious. Any marketing campaign has to utimitely be judged on one thing and one thing alone - sales.
Any business that is using Facebook likes as a primary indicator of how effective an advertising campaign is, in my opinion a long way from being on the right track. Advertising needs to show a return and most companies will burn piles of cash trying to make a return from Facebook ads. Arguing that you should be running Facebook ads and judging there success on the amount of likes is terrible advice to give people.
You don't need ads to build a community and increase brand awareness. Look at the free PR GM got just by pulling them :)
'Arrogant' is turning off 100% of a $10m ad buy in an environment where you can target the ads down to age, education, specific hobbies and interests etc. Especially when GM spends hundreds of millions in far less targetable, measurable environments.
No statistics are necessary to show how foolhardy it was to shut down this entire buy.
Oh, and of course not! Not overly critical at all.
As said above it is hard to put a value on social media or to fully understand how to use it correctly. Could not agree more. I think as time goes on the general public is beginning to get a better feel for why it is such an essential part of a successful marketing campaign.
There is no doubt why CTR will always be low because people come to hang out on FB and not to make purchases. Google on other hand is a giant because people search for product there with the intention to make a purchase or even make a decision.
In the above mentioned article you have mentioned that "You only pay if someone actually clicks on the ad" although it is completely true but when somone is spending their money on ads they look for conversions (ROI) which is definitely no where near an adwords campaign. So why would not they put all their budget on Google and completely ditch FB?
I dont even remember when was the last time, I looked ad the ads on facebook while using it. They are not visible at all. Even if they are I see crap like ads of dating websites whose only intension is to gain some fans and then throw their CPA campaigns on them.
Just having a fanpage is enough to make you presence felt on it but I wont even think of paid ads on a social networking website. I would rather choose a website with good traffic in my niche and try to buy an ad space.
they need to do what Nike and Forbes does. Facebook Ads to other ads and other content. Not ads that say
"Buy Car"
I saw a nike ad on facebook that just went to another youtube video ad. It was highly creative. Forbes does it too when they are trying to market a particular piece of content.
I also sometimes think that facebook advertising can be TOO targeted. For example all i see is ads for "Buy Links" and other SEO companies. No way I am ever going to convert for them in that vertical. I should be seeing GM ads - but since I am not interested in CARS on facebook, I don't see them.
THIS IS A HUGE PROBLEM FOR FB AND THEY NEED TO FIGURE IT OUT. should be your next article :)
Definitely facebook is a strong internet medium to advertise because it has large number of user and hence the reach of the this socila networking site is also maximum.
There is one thing missing in your analysis. More and more people are accessing facebook on their mobile device (smartphone) than via a desktop computer (or laptop). Facebook ads don't show up on the mobile app, which means fewer people are seeing the ads. This trend continues to grow and it is estimated that by 2014 Mobile internet usage will overtake desktop internet users (Morgan Stanley Internet Trends Report). Even in emerging countries this is the case, as mobile networks are more reliable than using a traditional computer, and purchasing a smartphone is more advantageous than a traditional computer. Mobile is the taking over as the new medium.
There is still a way to go before internet usage on mobile devices outgrows desktop usage worldwide, but the trend shows that it will happen in the markets companies care about most within the next 2 to 5 years. GM was early in dumping their Facebook ad campaign, I agree. With that said, Facebook needs to develop an ad solution for their mobile app soon, or find a new way to monetize.
This means that posting relevant and engaging content consistently and often is still the best method for making social media work for your business or client.
As SEOs, I know it's ridiculously easy to take pot-shots at paid advertising ROI, but GM's clearly doing something wrong here.
When Fiat (freaking FIAT, you guys!) has more Likes than GM on Facebook, that tells me they can't even get their social content curation strategy right, much less their advertising.
GM have highlighted the trend that paid internet advertising is fairly weak. Great. I couldn’t help but smile when I read this a few days ago. Facebook is a method. Social Media is the means, so how about some encouragement for using this rather than moaning about the GM-Facebook divorce.
Ive written more about this at https://bit.ly/Jv3Igf
Since social media is earned I believe the rewards can be greater than traditional advertising channels. Paying close attention to creating an engaging strategy on FB is extremely important and I overall I think the “likes” a company receives without the paid advertising are going to be worth more, but keeping a close eye on measuring a paid FB campaign’s success could be very beneficial. The customer that “likes” a company page through the paid FB ad is still available for that company to make an impression, and FB is such a great place to make a great impression.
“Understand earned media. Your Facebook following is a long-term asset. It’s a community that’s primed for your marketing message.” I think this is the huge takeaway here. It’s so easy to measure all paid advertising success the same, but FB advertising is unique. As soon as a company gets that “like” they got invited to the party; where the invitation comes from matters a little, but ultimately it’s what you do once you get there that makes all the difference.
All that aside – I agree this could be a creative PR move to go along with the FB IPO. Thanks for the post!
You are right on about the fact that GM needed to learn how to better use and understand earned media. I have said on multiple occasions that I find it interesting that they will spend huge dollars on traditional advertising and not truly know their ROI from each individual ad, but then they also lack the foundation and metric-control to develop a campaign where they can test what is working and what doesn't.
Such a silly thought that Facebook ad leads directly to car purchase. They had a great opportunity with ads to do some testing with a hypertargeted market, and to especially start appealing more to women, but, as you said, they cut off their whole arm for the hangnail.
When the news about GM pulling their ads came out, I wrote this post on how GM could have measured and understood the value of Facebook better and could have long term measured the value of the individual customer. https://info.ottopilotmedia.com/blog/bid/126252/Why-General-Motors-Pulled-Its-Facebook-Ads-Op-Ed
Are facebook ads considered Inbound Marketing? its not like Adwords where you search for something and they present you ideas, facebook push ads to your face. Poeple are switching to Inbound Marketing and I agree with that.
Also, It's very difficult to calculate the ROI of social network.
If you compare Fiat with GM you will see 509,708 likes · 8,562 talking about this vs 380,935 likes · 5,815 talking about this. I consider GM could do way more with Facebook than what they did so far.
Without real data we can just guess, and our opinions are not based on real data analysis.
Also we should not forget the Facebook IPO was a trending topic and this can be just a simple marketing strategy from GM to get more attention.
Good points @Virgil. Check out Toyota too - they are pushing towards 1 million likes. Comparing the other brands, and I'm a car guy, the GM wall is just plain boring. Granted, they are the umbrella company for the car makes, but they could certainly pour some life into their posts.
One thing to keep in mind - they have Chevrolet, Buick etc. on Facebook as separate pages, too.
Very true, though if I may play devil's advocate... in comparing Ford Motor Company (1.5+ million likes) to GM I feel there's still no contest in terms of post interest.
I agree that $10 Million is a lot of money, but to pull their ads completely... what is GM thinking??? Refine your target demographic and simply reduce your ad spend. I agree with many comments above, FB ads are one of the most affordable PPC networks to be used!
I disagree; pulling their facebook ads off completely is a good idea. Because even a lower amount like $1 Million spent on a refined target demographic, on facebook, is much less profitable that $1 Million spent on adwords. I even think the $10 million would be better spent on old school television advertising.
As for facebook ads helping the branding... there are much better ways of doing that! In my opinion facebook ads look spammy and reflect badly on brands. (I said in my opinion so don’t hurt me with your comments)
I've never been impressed with Facebook Ads. They seem to be very spammy and not high quality clicks.
At the end of the day, people don't go on facebook to buy things. They go on FB to have fun. So it makes perfect sense that the ads would not be effective. No matter how targeted they are.
Using GM as an example, when they are running ads through facebook the chances are high that a large proportion of their ads are being shown to people who either a) don't drive b) can't afford a car c) don't want a new car d) aren't even paying attention to ads...
Does facebook ask you your driving status? no. Does everyone that drives mention cars? nope... so even if you used profile information you're unlikely to reach the relevent market.
Also, the personalisation of ads with names of friends etc makes the adverts even more uneffective. Tons of people click things just because it has their friends name attached to it, but that doesn't mean that they want the product.
At least with other advertising platforms (such as adwords) the audience you show your ads to have to have already shown an intent to buy/enquire within your niche (via the keywords in their search that trigger the ads).
How do you know that GM didn't take all of that money out of facebook and put it into something more worthwhile?
As the saying goes - "To assume makes an ASS of U and ME"
To be worthwhile, Facebook ads would need to generate 45,000 cars sold. Staggering numbers for you and I, but for a company that sold 9 million cars last year, that’s a totally achievable goal.
Excellent point! Businesses do need to see the bigger picture in terms of how much Facebook can do for their sales. We wrote an article about how important Facebook is now because we still see businesses avoiding it like the plague or (as in GM's case) they walk away without realizing the revenue they're losing -- https://www.thinkbigonline.com.au/why-twitter-facebook-and-google-are-must-haves-in-your-seo-arsenal/
Amazing how every one "experiences" SEO and Social but fails to understand why and how its important for brands and businesses. Nonetheless, I think its up to the pros to be able to present a convincing argument in favor of it. The important thing, as you mention, is to keep perspective when it comes to making business decisions regarding digital.
Great post Ian!
Social media is about influence, branding and public awareness. Client always asks us that where is the clicks coming from Facebook? They just can't understand the purpose of social media marketing. We should show them the brands like Coca-Cola, Cadbury etc. How they have built a strong community and fan base over Facebook? Social media is a platform by which you can force the people that they always think about you. You can't measure the success of social media campaign by clicks or goal conversions. GM also think same as other typical client thinks. It’s very true and sad about GM.
I think GM should have changed the advertising staff or company instead of just closing the budget for facebook ads completely, they would be missing a 900+ million of people here on the web...
Agreed Asad! LOL!
could you please add some analytics with your posts instead of wish washy guessing?
Couldn't agree more. If correctly optimized, FB ads are one of (if not the best) PPC deal available on the web. Thanks for the share Ian.
I believe that the type of people using facebook are non fluential
Great Post indeed! I think this is not for GM only but for everyone who is investing on Facebook Ads. People need to understand Facebook Ad and what they will get at the end of the day as a result… many people invest on facebook ads to get direct conversions which is not really a powerful measurement KPI.
Unlike Google Adwards, Facebook Ads will provide you branding, audience to stay engaged with you and similar stuff and by participating with your audience you can generate sales out of it. But expecting hard sales through facebook ads is not the right KPI since beginning!
Very Pro tip: If you manage a Facebook campaign, you’ll hit a point where you want to turn it off. Don’t. Instead, test, refine and improve.
In my experience with FB I must disagree, and I did not turn off my campaign I readjusted it etc.. a boring niche (or a small demographic) is a boring niche. How many things can you post in a day for a boring niche (or a small demographic). Saying that FB is a good fit for everything is off. Only trendable material can truly help via a social network.
I like to look at things from a user perspective.
Why do I like a page? For entertainment, so my friends can see what I like, to stay up to date with someone (usually entertainment or technology).
What do I "NOT want"? 4 posts a day cluttering my feed, from a construction company that I liked for a 10% discount. I doubt any of my friends are going to share the latest testimonial by Joe Shmo for a random small niche product or service.
What do I "want"? Entertainment, latest technology’s, and news worthy material. I want my friends to get interested in what I shared via the page, I want them to like and share it.
FB can work but only for some companies.
The example was GM. The marketing for that is easy with a huge budget. Everyone needs a car and there’s a million things to talk about, technology wise/news worthy. Lets try this experiment again and ill pick the topic. : )
There's no such thing as a boring niche, only boring people.
David You Are my Hero today :)
To say that I agree with your phrase is obvious, isn't it?
Well then, can you please share an example of a great social presence for just one property management company, or one for impact windows, or one for document scanning.
I am kind of stubborn so please just provide a link to one of those topics I listed. If I am wrong I will eat my words.
People better than me wrote tons of words about what you call marketing in boring niches:
https://www.toprankblog.com/2012/04/boring-products-marketing/
https://kaiserthesage.com/viral-content-ideas/
https://jeffrutherford.com/social-media-for-boring-products-and-services/
https://www.searchenginepeople.com/blog/linkbait-ideas-for-small-business-owners.html
https://www.97thfloor.com/blog/viral-social-marketing-ideas-for-boring-industries/
Yes I have read many of these and applied many of these strategies to my campaign, thanks for the suggestions. However after testing these strategies I learned that not only was it not worth my time, I also checked many of my competitors social presence and it seams like none of them have anything trending.
In other words... It's easier said then done. I want an example of a succeeding company in one of the boring (which you claim there is no such thing) niches I listed. Better yet maybe you can do a case study to show me how this can be done. I have no faith in social media for a small demographic (AKA IMHO boring niche).
That’s funny coming from the guy who has this as a description for his personal blog:
davidmcohen.com
Personal blog where I bore people to death with my ideas about marketing.
lol. Ever since I get to do SEO for an SEO company its actually way easier to get social interaction. However, that does not change a boring niche or a small demographic. In fact forget boring lets just say a small demographic. If there aren’t enough people to care about something how will it trend? There are many people looking up SEO/Marketing etc... But how many people are looking for information on "Property Management" what can one write on a social network that would make someone else like, share or interact with property management?
<sarcasm>Hint</sarcasm>
I'd actually like to throw some ideas your way because I stand behind my statement that there are no boring niches. If you're interested, my email address is in my bio, shoot me an email and in the next day or two I'll get back to you with some things to think about.
Your last two posts....
"<sarcasm>Hint</sarcasm>" Oh you were being sarcastic...
"I'd actually like to throw some ideas your way because I stand behind my statement that there are no boring niches. If you're interested, my email address is in my bio, shoot me an email and in the next day or two I'll get back to you with some things to think about."Are you still being sarcastic?
<Hint> contradiction!!!</Hint>
One of the things I learned from SEOmoz is to stay consistant. Stick to your guns my man. Id love to hear your suggestions. I prefer discuss them here where we can all learn. Unless its a secret you dont want anyone to know about...
This conversation sounds a bit personal. There are personal attacks than constructive debate.
Donnie - I get where you are coming from. My dad's business is in agriculture. He farms fish and sells them live to various wholesalers who then sell them to retailers.
Sure it's a multi-million dollar business, but it's a boring niche. And it's a "tiny" niche. His customers number less than 100 in the nation. None of his competitors are in any social media and no one conducts any SEO.
My father in law founded - and still runs - a 300-employee steel factory. He supplies, for example, specialized screws for bridge builders. Again, same thing.
Who searches for these stuff on Google and who would follow them on social media?
Having said that, I think of it as more of an opportunity than a crutch.
They COULD do what Intel did. Intel's major customers are large corporations. They are "small" in number. But Intel began to advertise directly to their consumers and built their brand.
The average person don't care about CPU, and they know Intel.
Would it be easy? Of course not. If it is, no one would claim it's "boring".
And to answer your question: https://www.facebook.com/ResortPropertyManagement
A property management company with 4000 fans. Sounds small to most people, but that maybe half of their industry. You don't need everyone to follow you.
4000 fans and very little interaction per post. My guess is that a good majority of those likes have been paid for.
First off, nothing personal above, sorry if it came off that way.
Thank you for sharing the great story about your dads business. They’re hundreds of more companies like his with small demographics that are very successful. However, they’re not successful in a social network such as Facebook.
The property management company example you gave is great. I noticed that they have about 3 posts for the year and out of 4,000 users they only have one person currently talking about them. This is exactly it; if this company took the advice presented above and posted 4 posts a day… their likes will probably take a hit. Who wants to see 4 posts a day about “how we have the best property management skills in the business”
Also in the example you gave this was for a resort more then a property management company. A resort is much easier to create some buzz with. People look forward to vacations and “like” pretty pictures.
When you’re browsing your Facebook, what are you more likely to click on (interact or share) ?
1 of the 4 posts a day about: “how we have the best property management skills in the business!”
or…
A single picture from a beautiful resort
Intel is way more interesting in my opinion to a property management company. Intel is technology… Please refer back to my first comment “Why do I like a page? For entertainment, so my friends can see what I like, to stay up to date with someone (usually entertainment or technology).“
“A property management company with 4000 fans. Sounds small to most people, but that maybe half of their industry. You don't need everyone to follow you.”
Anyone can buy 5,000 likes from Fiver and get way more interaction on a page simply creating memes.
That’s $5 and 5 minutes a day of creativity. But how does this help in the bigger picture? How can a company with a small demographic (IMHO boring niche) get sales out of this?
Following this thread with interest. I would also like to see some real examples. Share and share alike.
Hi there. I work for a company that specializes in software and marketing for the oh so boring “property management” industry as you put it. We just started with Social Marketing efforts and currently have five different property management Facebook pages, one of which has grown from 35 fans to over 8,000 fans. We do use some paid advertising, but we also email market to past guests and we have gained tons of fans from people making comments on our page and friends liking it as well.
Saying the property management industry is boring shows how little you know about the industry as a whole. I am not saying this to be aggressive. There is something to be said for specialization. Just like a doctor declaring a specialization and knowing everything thing there is to know about that one particular bodily function, so is marketing to a particular niche. Very few people, but the ones that have been immersed in this industry for a while, like our company, would know how exciting it is and how much money there is to be made in the world of vacation rental management. It’s a vibrant fast growing industry with a fast growing demand. (We even have a TV show… Getting away together)
To me what this all comes down to is learning to market for quality not quantity. The number of people that like my page is not as important as the number of people that turn into paying customers.
I should also not that there is a reason i did not include links to my clients pages but the stats are as follows
#of peole talking about this 394
we post once daily and we post are information not just we rock stuff. we psot specials, area events, intersting facts, funny pictures and lots more.
we have had 3 unlikes in the last month...
And the post I did this morning already has 57 replies and 110 likes.
hope this helps give context to what i posted above.
What would you rather rank in search engines for: "property management w/location" or "vacation rental w/location"?
"Very few people, but the ones that have been immersed in this industry for a while, like our company, would know how exciting it is and how much money there is to be made in the world of vacationrental management"
I agree there is plenty to talk about vacations and resorts.. Lets say "commercial property management" because as I posted above everyone loves vacations (pretty pictures)
If you don’t mind, it would be great if you can share a link to that Facebook page you mentioned... are you posting 2-4 posts a day? out of 8,000 people how many of them do you think want to see 4 posts about a commercial property management company per day?
I would delete them on day 2.
I cant post links because of client confidentiality... sorry i would really love to but i am not the boss.
I agree with you that posting 2-4 times a day is a bit much i usually post once or on a rare ocassion twice per day to keep from overwhelming our audiance. If we were a news site i would post more like you mentioned originally people dont minsd that but they do mind "buy, buy, buy" every five seconds. Its about balance in my opinion.
As far as "commercial rentals" I am thinking you mean long term rentals. Alot of our clients have long term rentals (a year or longer) as well as a sales side to the company, kind of a one stop shop. If i were working on the long term rentals i would still focus on the area beacuse as the phraze goes real estate is all about "location, location, location." I would simply shift my focus to post about schools in the area (scores and awards), area events like plays and concerts, weather advisories, best parks, community projects.
It also really depends on what the client is already doing in the community. People get on social media to get involved in a community so I often try hard to take that strength and utilize it.
We have one client that talks about sea turtles and the "sea turtle hospital" in the area they live in and surprisingly they get alot of interest in their properties because of it.
And to answer the first question I would rather rank well for "vacation rental /w location"
I'd love to hear your ideas
If it’s not working for you, you might not be doing it right! I like the advice by Ian, Instead of stopping the campaign and say Facebook Ad is bullshit try to test, refine and improve!
Boring Niche! I don’t see anything as boring niche… seriously!
I mean you are marketing for a service or product because you want to sell, audience trust, increases and enhance your outreach or if I talk straight you want more return on investment… If you are targeting a particular audience that you think they need it (and if you are right) why will they hate it? I don’t see any point in it… yeah your idea to present can be boring or something that does not appeal to your audience but in that case the good ideas is to refine, test and improve instead of shutting it down!
There is such a thing as a boring niche, just because some people never encountered it doesn’t mean its non-existent. I gave three examples above of three boring niches.
Give me an example of one company who is succeeding in any of these niches on Facebook: property management, or one for impact windows, or one for document scanning. (BTW this list is endless)
As you can see above, some people mistake property management with vacation rental. Lets call it commercial property management.
I stand correct until proven wrong.
Can you explain what your definition of "succeeding" is?
There is such a thing as a boring niche, just because some people never encountered it doesn’t mean its non-existent. I gave three examples above of three boring niches.
Give me an example of one company who is succeeding in any of these niches on Facebook: property management, or one for impact windows, or one for document scanning. (BTW this list is endless)
As you can see above, some people mistake property management with vacation rental. Lets call it commercial property management.
I stand correct until proven wrong.
This is really fantastic. The unlimited access makes it even better
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