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General Motors To Stop Advertising On Facebook
The move by General Motors comes at a time when Facebook has been scheduled to go through an initial public offering (IPO) this week. GM is the third largest advertiser in the United States and the decision by the company has marked the first highly notable beat at the strategy of Facebook generating doubts whether advertising on Facebook works better than traditional media.
However, GM said it will still use free Facebook pages for marketing which is free to market its vehicles. GM also said it was not unusual for the company to move spending around various media outlets.
"In terms of Facebook specifically, while we currently do not plan to continue with advertising, we remain committed to an aggressive content strategy through all of our products and brands, as it continues to be a very effective tool for engaging with our customers," the company added.
GM spends about $40 million to maintain all aspects of its Facebook marketing -- including about $10 million on paid ads. The automaker began to reconsider advertising on Facebook earlier this year.
GM was the fourth highest spending company, to be only behind Procter & Gamble Co., Unilever and L' Oréal on global advertising in 2010 costing $2.8 billion in the United States and $3.9 billion globally. Facebook refused to comment on the automaker's move.
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