Why Did GM Drop Facebook Advertising?

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I am sure you heard yesterday that GM stopped investing in ad space on Facebook. New research on Facebook advertising performance from WordStream may offer a few clues as to why General Motors discontinued advertising on the massive social network.  Wordstream’s research provides some important data such as:

  • Ad Performance: Click through rates on Facebook ads are 10x lower than Google Display Ads, and 2x lower than your average Internet Banner ads
  • Ad Formats: Facebook has very few advertising formats
  • Ad Targeting Options: No mobile support

Facebook vs. Google Display Network

Wordstream created an infographic with their study called Facebook IPO: Can It Beat Google. This IG looks at Facebook vs. Google Display Network and focuses on advertising reach, revenues/growth, advertising performance, ad targeting options and ad formats. If you are trying to decide which advertising option is best for your business the infographic below and  Wordstream’s study will give you some important facts to consider.

What has your experience been with Facebook Advertising How does it compare to Google Display Advertising? Share your thoughts in the comment fields below?

Click to expand.

Melissa Fach

Melissa Fach

Melissa is the owner of SEO Aware, LLC. She is a consultant and trainer helping companies make the most of their content marketing and SEO.... Read Full Bio
Melissa Fach

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  • Iain

    I read an interesting blog by Michael Mothner from inc.com earlier in the week about why Facebook ads are different from Google ads and why your expectations and practices need to shift.


    It’s certainly something that we need to see more data on before we can get a true picture. I suppose assessment of what constitutes success in terms of Facebook ad campaigns is due also.

  • Justin

    Great infographic. It’s very consistent with my experience with Facebook Ads. After increasing budgets significantly I was admitted into their fast track program for agencies and assigned an account representative. Once we looked at the analytics for our campaigns I really began to question the value. My representative could not explain the vast difference between clicks reported by FB and web visits tracked via tracking URLS in Google Analytics. The cost per web visit ended up being astronomically expensive. Recently, we eliminated FB advertising and moved that budget to AdWords for a particular client. Their leads have increased by over 30% and all other indicators of traffic quality have improved drastically. I’ll be hard pressed to go back to FB advertising anytime soon.

  • Karan Goel

    GM was bankrupt anyways.. I don’t think it really mattered why they pulled out.. FB is stronger than ever..

    • Norm

      I think it does matter. The question isn’t how strong GM or FB are, it’s how effective FB advertising is versus Google Display network.

      Personally, I think for most advertisers, I think both are not very effective. FB does have better demographic targeting, but Google has better context targeting. My audience does share some demographics, but they definitely share a related interest, so for me, targeting my ads by context performs better.

      One area that Google has hands down, is conversion tracking.The last time I advertised on FB, they dropped their beta conversion tracking program, and left it up to digging through Analytics data to try and figure out if FB referrals where from your ad or wall, and try to discern ROI. Maybe that’s changed now, but my thought at that time, was they were stopping conversion tracking because too many advertisers where finding out what a low ROI FB had.

  • Muas

    Very nice post Melissa. The main reason GDN works better then facebook is multiple sizes of banners, which help in attracting more users.

    Why don’t you make comparison infographic of Google Search and Display Network?

  • Todd

    Do we really think that Facebook is long term in it’s current implementation ? Is it so much better than Myspace to warrant such a high valuation ?Yes it has a big list but look what is on facebook these days – quotes of the day and some nice pictures – People don’t need to advertise because they can post stuff themselves.

    It wouldn’t surprise me if GM setup multiple blogs and had people write about their cars – Oh silly me they already have truckloads of people writing about their cars.

    Facebook will need to show something special going forward and right now all they can do is build up a war chest and go on the acquisition spree for bricks and mortar businesses.

    People are still searching for stuff and that is why google will continue to be No.1

    As a social marketer you need to be aware of all the converging social media platforms and target your advertising accordingly , test and re-test. Results are the only way real advertising is mentioned.

    “We Sell or Else”

    • Norm

      Todd, Facebook’s demographic targeting is special. You can’t do the level of demographic targeting on Google’s search or display network that you can do on Facebook. It really is special. The question is, is it effective. Facebook does have a lot more going for it though, then quotes of the day and some nice pictures, and yes, it is much better then MySpace.

      • Todd

        If Demographic is so special when why are GM leaving? They aren’t getting the results – Period.

        I am not convinced about the viability of Facebooks model. They really need to buy some bricks and mortar businesses. All it takes is one thing and people will start switching off in droves. I am seeing more and more people advertising their businesses on facebook in their statuses and this is a great social media strategy –

        Look at the take-up of pinterest for example as another social media platform diluting facebooks social media share.