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GM Says Facebook Ads Don't Pay Off

GM Says Facebook Ads Don't Pay Off | Marketing in Motion_MBA 529 | Scoop.it
In May 2012, Facebook was going to have its initial public offering (IPO). At the time, anything related was big news as the market was trying to assess the future value of the stock. What grabbed me about this story is its authors appeared to raise the question as to whether social media marketing was worth it? The internet has been praised for changing the marketing game, in particular with regard to its ability to enable companies to directly market to customers. One only has to look to Amazon for proof.In the spring of 2012, GM's frustrations over the assessed value of marketing on the social media site saw it pull out its paid advertising. One would think a $10 million dollar investment would yield some measurable results but everything is relative. This only represented a small portion of GM's $1.8 billion dollar advertising budget for 2011. For this relatively small investment, it begs the question why not give Facebook more time. By comparison, Kia Motors, who raised similar concerns, increased their budget.The frustrations GM had speaks to the fundamental challenges of marketing - how does a company measure its return on a marketing investment. While I was hoping for some significant insights on the value of social media marketing, limited were to be found in the article. One that I gleaned, however, is that it appears that GM persisted in trying to use the social media site as mass marketing tool rather than as tool to gain customer insights or strengthen the brand's image. As the article mentions, it is hard to ignore the fact that Facebook offers access to one of the largest audiences in the world. Maybe the most compelling evidence that social media marketing has value is the fact that GM has recently returned to Facebook as a paid advertiser.In May 2012, Facebook was going to have its initial public offering (IPO). At the time, anything related was big news as the market was trying to assess the future value of the stock. What grabbed me about this story is its authors appeared to raise the question as to whether social media marketing was worth it? The internet has been praised for changing the marketing game, in particular with regard to its ability to enable companies to directly market to customers. One only has to look to Amazon for proof.In the spring of 2012, GM's frustrations over the assessed value of marketing on the social media site saw it pull out its paid advertising. One would think a $10 million dollar investment would yield some measurable results but everything is relative. This only represented a small portion of GM's $1.8 billion dollar advertising budget for 2011. For this relatively small investment, it begs the question why not give Facebook more time. By comparison, Kia Motors, who raised similar concerns, increased their budget.The frustrations GM had speaks to the fundamental challenges of marketing - how does a company measure its return on a marketing investment. While I was hoping for some significant insights on the value of social media marketing, limited were to be found in the article. One that I gleaned, however, is that it appears that GM persisted in trying to use the social media site as mass marketing tool rather than as tool to gain customer insights or strengthen the brand's image. As the article mentions, it is hard to ignore the fact that Facebook offers access to one of the largest audiences in the world. Maybe the most compelling evidence that social media marketing has value is the fact that GM has recently returned to Facebook as a paid advertiser.General Motors plans to stop advertising on Facebook after determining its paid ads had little impact on consumers. The news comes just days ahead of Facebook's IPO.
David Warnke's insight:

Wall Street Journal - Business

By Sharon Terlep, Suzanne Vranica and Shayndi Raice

Updated May 16, 2012 2:45 a.m. ET


In May 2012, Facebook was going to have its initial public offering (IPO). At the time, anything related was big news as the market was trying to assess the future value of the stock. What grabbed me about this story is its authors appeared to raise the question as to whether social media marketing was worth it? The internet has been praised for changing the marketing game, in particular with regard to its ability to enable companies to directly market to customers. One only has to look to Amazon for proof.

In the spring of 2012, GM's frustrations over the assessed value of marketing on the social media site saw it pull out its paid advertising. One would think a $10 million dollar investment would yield some measurable results but everything is relative. This only represented a small portion of GM's $1.8 billion dollar advertising budget for 2011. For this relatively small investment, it begs the question why not give Facebook more time. By comparison, Kia Motors, who raised similar concerns, increased their budget.The frustrations GM had speaks to the fundamental challenges of marketing - how does a company measure its return on a marketing investment. While I was hoping for some significant insights on the value of social media marketing, limited were to be found in the article. One that I gleaned, however, is that it appears that GM persisted in trying to use the social media site as mass marketing tool rather than as tool to gain customer insights or strengthen the brand's image. As the article mentions, it is hard to ignore the fact that Facebook offers access to one of the largest audiences in the world. Maybe the most compelling evidence that social media marketing has value is the fact that GM has recently returned to Facebook as a paid advertiser.

David Warnke

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Joachim Scholz, PhD's curator insight, April 1, 2014 12:49 PM

Insight by David Warnke:

 

In May 2012, Facebook was going to have its initial public offering (IPO). At the time, anything related was big news as the market was trying to assess the future value of the stock. What grabbed me about this story is its authors appeared to raise the question as to whether social media marketing was worth it? The internet has been praised for changing the marketing game, in particular with regard to its ability to enable companies to directly market to customers. One only has to look to Amazon for proof.

 

In the spring of 2012, GM's frustrations over the assessed value of marketing on the social media site saw it pull out its paid advertising. One would think a $10 million dollar investment would yield some measurable results but everything is relative. This only represented a small portion of GM's $1.8 billion dollar advertising budget for 2011. For this relatively small investment, it begs the question why not give Facebook more time. By comparison, Kia Motors, who raised similar concerns, increased their budget.The frustrations GM had speaks to the fundamental challenges of marketing - how does a company measure its return on a marketing investment. While I was hoping for some significant insights on the value of social media marketing, limited were to be found in the article. One that I gleaned, however, is that it appears that GM persisted in trying to use the social media site as mass marketing tool rather than as tool to gain customer insights or strengthen the brand's image. As the article mentions, it is hard to ignore the fact that Facebook offers access to one of the largest audiences in the world. Maybe the most compelling evidence that social media marketing has value is the fact that GM has recently returned to Facebook as a paid advertiser.

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You're richer than you think

You're richer than you think | Marketing in Motion_MBA 529 | Scoop.it
Scotiabank's tag line is the most recognized among banks in Canada, with an 85% recall among consumers — a little controversy can sometimes be a good thing, perhaps
David Warnke's insight:

Scotiabank's 'You're richer than think' tagline pays off

 

It's my love-hate relationship with Scotiabank (love their mortgage rates, hate their service) that pulled me to investigate their all too commonly known "you're richer than you think" marketing campaign. The 2012 article by Holly Shaw published in the Financial Post showed the bank's marketing campaign is shifting its focus slightly from the Boomers to the Generation Xers. 

 

The article highlights some of the early controversy of the marketing campaign's tagline, in particular with the Millennials, shown when the odd one threw a beverage in theatres during the recession. There was reason for the frustration; in 2009, youth unemployment was reported around 15%, close to double the national unemployment rate. Scotiabank quickly adjusted the campaign's focus to emphasize the bank can help maximize ones' dollars. This message resonates with all generations, in particular the Boomers who hold the bulk of Canada's savings, as many are approaching or in retirement. Scotiabank's persistence to stay the course with the tagline and shift the marketing plan paid off, despite a little controversy.

 

It appears the time (2012) was right for another shift in the marketing campaign focus. The article highlights the fact that the Canadian banking sector is stable and reliable, which makes it hard for customers to distinguish between brands. Therefore, banks need to distinguish themselves beyond rates. Scotiabank's new approach was to redefine wealth in terms of relationships and experiences, both of which resonant better with Xers and Millennials. The focus on experience is an approach that MasterCard has embraced. A competing brand, the Toronto-Dominion Bank (TD), has also recognized the requirement to go beyond rates, with marketing focused on providing longer hours and better service. By focusing on relationships and experiences, Scotiabank is hoping to emotionally connect with its clientele, an assured method of sustaining the bank's prosperity. 

 

David Warnke

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Joachim Scholz, PhD's curator insight, February 12, 2014 2:45 PM
David Warnke's insight:

Scotiabank's 'You're richer than think' tagline pays off

 

It's my love-hate relationship with Scotiabank (love their mortgage rates, hate their service) that pulled me to investigate their all too commonly known "you're richer than you think" marketing campaign. The 2012 article by Holly Shaw published in the Financial Post showed the bank's marketing campaign is shifting its focus slightly from the Boomers to the Generation Xers. 

 

The article highlights some of the early controversy of the marketing campaign's tagline, in particular with the Millennials, shown when the odd one threw a beverage in theatres during the recession. There was reason for the frustration; in 2009, youth unemployment was reported around 15%, close to double the national unemployment rate. Scotiabank quickly adjusted the campaign's focus to emphasize the bank can help maximize ones' dollars. This message resonates with all generations, in particular the Boomers who hold the bulk of Canada's savings, as many are approaching or in retirement. Scotiabank's persistence to stay the course with the tagline and shift the marketing plan paid off, despite a little controversy.

 

It appears the time (2012) was right for another shift in the marketing campaign focus. The article highlights the fact that the Canadian banking sector is stable and reliable, which makes it hard for customers to distinguish between brands. Therefore, banks need to distinguish themselves beyond rates. Scotiabank's new approach was to redefine wealth in terms of relationships and experiences, both of which resonant better with Xers and Millennials. The focus on experience is an approach that MasterCard has embraced. A competing brand, the Toronto-Dominion Bank (TD), has also recognized the requirement to go beyond rates, with marketing focused on providing longer hours and better service. By focusing on relationships and experiences, Scotiabank is hoping to emotionally connect with its clientele, an assured method of sustaining the bank's prosperity.