What we can learn from GM taking advts off Facebook

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General Motors took their advertisement spend off Facebook.[1. GM pull ads off Facebook] Given the expectation around Facebook’s IPO, this is seen as bad news for Facebook. On the contrary I believe this is a classic example of how old world companies wrongly perceive paradigm shifts in technology and technology-enabled interactions. Will keep this brief but could do with some review and discussion from your end.

First let us understand how advertisements are served online today. A random user, say Ajay, does a search for a car or a related service like motor insurance. This keyword is watched by search engines or advertisement providers like Google, to whom vendors have bid on specific keywords to trigger display of their advertisements. So what you have is Intent -> translated to keywords -> keywords matched to list bid by vendors -> advertisement displayed. As you can see this is simple and works reliably. Works because their is a clear articulation of intent, you know what you are looking for before you hit a search engine. Variations can occur when advertisements are displayed in specific vertical sites, say like designer related tools on a site like Smashing Hub.

Now, think about what is lacking in this workflow from which Google makes most of its revenue. What is lacking is an understanding of the user. Who is she, what does she like, care about and so on. Yes, Google can and does track what searches you have made, what links you end up visiting..but these allow Google to only infer what you are as a person.

So, where does Facebook come in here. FB is your social network. You receive updates of what your connections liked, updated, saw, read and so on and likewise all your updates are propagated out. All within a single homogeneous network. This is a goldmine of engagement data using which FB can build a detailed profile of a person. Imagine how richly targeted advertisements can be on FB. A vendor could potentially say, “FB serve ads to people in Manhattan, NY area, who are environmentally conscious, like organic products and like kittens”. Am not aware to what granularity FB allows to target people but if they wanted they could do it. That precision in being able to target a message, will allow organizations to adapt messages, discounts etc to suit a particular demographic.

Now to GM. If a car vendor thinks, showing a bunch of ads on FB is going to drive sales or engagement for their car related services, they surely don’t understand what social media is about. Social media is about brand-engagement, being on top of mind for target demographic, its like a grease that smoothens all aspects of customer outreach. Taking an old business model, showing ads about your products to gain customers, to a brand new technology enabled capability like a social network will not work. The parallel I can think of is when organizations started doing Flash websites to show interactions without understanding underlying principles of hyper text.

Anyway, enough cribbing. What would I do if I were boss of advert spend on GM? There must be a hundred stories behind every car that GM has manufactured. Tell these stories on Facebook, get customers to connect with people behind the brand. Or highlight customer stories, where a safety feature saved a life, or a student who used a GM car for his first day at college or first job. Travel from point A to B need not be mundane, anchor it to aspirations, ambitions, identity and culture, then you have a much bigger canvas to experiment with. I feel FB is the first wave of social media platforms that are going to change how the world goes about living. But it takes work and creativity to harness a new medium like FB, just throwing ads to see if something sticks will not work.

What would you do if you were boss of GM? Share thoughts in the comments section.

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Comments

  1. Mahesh

    I am on the same hymn page as you when it comes to engagement in the social paradigm. What I am not entirely sure though is the efficiency of FB ads as revenue generators (unfortunately that is what campaigns traditionally have been evaluated against). Talking of engagement, a company – take GM for example – can (and possibly does) run a FB page where they try engage their “fans” – stories, experiences, rants and raves. When asked why GM needs to run ads over and above this engagement, the digital media boss would possibly struggle

    By the way, I don’t know if the Mahindras read your post but take a look at the new XUV5oo website they launched this week. Themed around “tell your car story” it strives to engage the users around experiences – a bit like how you suggest in the last paragraph of the post

    Regards

    Subrata

    • Mahesh CR says:

      Subrata – Very valid point actually. The advt is perhaps less relevant than the actual fan page, but the former can be a mere attention drawing mechanism to something awesome happening on the page. The advt is the equivalent of hand-drawn menu/special of the day in small cafes. I visit the cafe everyday and share a warm greeting perhaps but the board leaning against the entrance clues me in to what’s special today..its information, a tiny reinforcement of the bond I anyway share with the outfit. Of course whether all this will make me buy anything other than the usual is an open question.

      Ah, did not know about Mahindra’s launch actually..high compliment to even suggest they would have read my post..humbly accepted πŸ™‚ But frankly they must have people who would swipe the color off a rainbow by selling the ‘purity of no color’!

  2. Sudhakar Subramanian says:

    Dear Google,

    Thanks for shoving in my face “Meet Singles in your locality”. Screw you too Facebook. (I should start using InPrivate, Private and Incognito modes πŸ˜€ )

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