I work at a online advertising firm in DC specializing in political and non-profit work - mostly email list building, soliciting volunteers, awareness, etc campaign activities. We work with AOL, Yahoo, Google and Facebook, among many others.
I'm not a fan of FB's policies in general, but... We've found FB to be very effective - on a cost per acquisition basis, much more so than search advertising and on par with other vehicles.
Obviously, test to see what's effective for your needs, but I wouldn't rule out Facebook based on GM's experience. Cars are an unusually high involvement purchase, unlike most things people would be advertising.
Facebook is very good for non-profits, I've seen a non-profit animal conservation become the largest in my country thanks to it (Animales Sin Hogar here in Uruguay).
I guess it's because of the demographics (as someone said, facebook moms with free time - and a soft heart).
Anecdotal evidence, but I've heard it's very good for small shops targeted for women, and my girlfriend did buy from a facebook ad.
Perhaps your firm has found Facebook effective because of its altruistic nature. People want to share great things that they are involved in: nonprofit work, political activism, etc. Advocacy for such issues and causes are something FB users probably want to share with their friends.
Meanwhile, I imagine that people don't really share things like "I really like the new model of the Cadillac XYZ!". Maybe they think that their friends will view it as shallow gloating; maybe you don't want to reveal the fact that you bought a new car.
Facebook revolves around "Sharing of information". Brands that have values that users want to share with their friends will do well. Those that can make users think twice about sharing (even if they really do like the brand) may fare worse.
Yeah, if you're not GM, and not like GM, and not approaching Facebook like GM, then it's not clear you'll have GM's problems reaching out to people on Facebook.
Problems like Republicans attempting to take advantage of your presence to poke fun of you as "government motors". :)
> GM spends about $40 million a year on Facebook marketing, according to the Wall Street Journal, about $10 million of which is for paid advertisements. It will continue to post relevant content about the company and its brands on GM’s Facebook pages.
The best marketing on Facebook doesn't make Facebook any money.
Direct follow up with people is expensive. From the WSJ:
> GM spends about $40 million on its Facebook presence. About $10 million of that is paid to Facebook for advertising, the rest covers content created for the site, agencies that manage the content and daily maintenance of GM's pages, people familiar with the figures said.
Their page has (roughly) 300k followers. That's $100 per reachable user per year, which is insane.
If they were using that additional $10mm to get the 300k followers to begin with, that's an even worse indictment of FB advertising for traditional brands.
Remember that they don't have just one brand on Facebook. For example, they have 1.3 million followers on their Chevrolet page. They have 1.1 million for Cadillac. 400k for Buick. 660k for GMC. 525k for OnStar. 350k for their "TeamChevy" Chevrolet racing page. Now, there's sure to be some overlap there; but that's still easily 2 or 3 million followers.
That's a factor of 10 more than you were estimating; and that's just based on a quick poll of brands that I took a look at.
One FT employee easily costs more than $100,000 when you include benefits, expenses and so on.
Also GM sells a few dozens models of cars, I could easily see the salaries for the staff who do daily updates for all these models and the advertising agencies who manage it costing 30 million or more.
Also GM has annual revenue of almost 160 BILLION, 30 million is a drop in the bucket in their marketing budget.
Advertising agency doesn't sell you a great campaign, idea or pretty pictures.
they sell you media. with a HUGE markup.
10mil media can cost way more than 30mil if bought from an agency creating the 'creatives' (in the case of car ads, a picture of the car, or a movie of it cruising on a road where the art director likes to take vacations)
I'm curious what your thoughts are from there? Who does the purchasing?
Don't tell me it's all going RTB or something like that; premium advertising is still how the publishers are going to make money and you really can't automate that.
You are going to need high touch sales presence, bespoke custom executions, etc.
GM kindof has their work cut out for them on facebook. Most of facebook isn't looking for a new car (maybe a used one) and the facebook moms aren't exactly stoked for GM cars.
Most people are on Facebook, so there are a large number of people looking for new cars. Facebook's big pitch to advertisers is that it can target better than anyone else. Why can't they find people who are looking for a new car?
I think a better question is how GM measures the effectiveness of their campaigns on Facebook. Its not like you can track the conversion rate from ad click to car buy.
I'd imagine that they're doing a form of A/B testing geographically. All other things equal, its easy enough to only do an ad campaign within a certain radius of a dealership and measure the change in that dealership to others in the state.
You can't track the conversion rate from a TV ad either. That doesn't mean you can't notice a positive/negative effect related to the presence/absence of the ad. Especially at the scale of GM.
Your impression of Facebook's user base is about five years out of date. Facebook is closing in on having ~1,000,000,000 members. I would suspect millions of those members are looking for a new car right this second. Facebook needs to find better a way, like Google did, of matching those members with advertisers.
Why do you say that? Granted I don't hang out with starving students, but the people I know on Facebook are quite capable of buying new cars. I don't know why you think moms aren't interested in GM cars. Around here GM trucks and cars are selling pretty well.
In any case a lot of people here, as another poster said, are confusing direct advertising with branding. I'm not in the market for a new car, but if I'm on Facebook, it's more than likely because I'm bored. If a car ad that looks good is on the page I'm on, I'm likely to click on it and look at the car. A year or two from now when I might be in the market, that make of car I keep seeing on FB is likely to be on my mind as a possible candidate.
And now that I think of it, I keep seeing brand new GM Yukons on the road and I like the way they look and they look like they are good tow vehicles. If I saw a Yukon ad on facebook, odds are I will click through.
I certainly didn't have a $10MM spend, but I also had dismal results for my B2B campaign. My takeaway is FB is purely a social place where people unwind and don't want to do any 'work' -- whether that is considering a product for their job, or the effort involved in considering a large purchase as rio517 mentions.
Sure, that seems to be the default for most things, but I guess what I really meant to ask was more about specific sites that do their own ads, outside of Adwords. I'm guessing industry vertical sites are good for B2B, but I'd love to hear about other folk's experience in that regard.
I agree with you. Me and anyone that I know that uses Facebook already got used to ignoring the right column by default. Slowly but surely it gets to the point that it doesnt really matter what you advertise. I challenge you, if facebook approves it, to put and add "giving money for free" with landing page and see a click rate. It will be similar to advertising anything else, because users are getting smarter (thats good) nowadays and "sounds too good" offers will steer them away.
edit: for that reason, I think Facebook advertising does not work. Or at least, does not work for the _most_ of advertisers. Its just that Facebook is still new and here and there I hear my friends being exciting about "advertising to millions of customers" and they do give it a shoot with a poor results at the end. The point is you have so many people that havent tried that yet that they still bringing cash to FB. But unless FB does something for the ads to work (change its core product?), the $ numbers will only fall.
No, I sort of agree with you. There seems to be a lot of excitement about how valuable targeted advertising is (once more.. this happened back in the 90s as well..). Social media "managers" popping up in every company, and being paid rather well. (while this should just get filed under PR)
The real value of Facebook will be when they release their ad network to compete with Adsense/Adwords. Facebook is more valuable as a vehicle for collecting user data than displaying ads.
I don't follow you. Are you agreeing or disagreeing that this move looks like the outcome of a failed behind-the-scenes negotiation or even an extortion attempt on GM's part?
Well if Facebook ads DO work (at least for GM) I don't believe they would have pulled their campaign no matter what ulterior motives they may have. Sales are sales.
That's pretty ridiculous. The marketing department of GM isn't worried about the best deal. It's great if they can save money, but how much could GM really be saving with, oh I don't know, let's just say, Google? Keep in mind they spent $10 million on Facebook. One tv ad during the Super Bowl is probably half that. If GM believed they would lose sales by ending Facebook ads, they wouldn't end them. Even if that were true, you aren't going to sabotage a projected $100 billion IPO with a $10 million account.
It would certainly be better for Facebook if this were a conspiracy, but I don't believe that's what's happening here.
Perhaps the author has been sitting on said story for a while and decided to publish it at point of maximum impact? It's likely to get a lot more attention now than it would do at almost any other time.
Two of my friends run a wedding planning business. They gave up on targeted Facebook ads because they got MUCH better results using Adwords.
The ads were targeted to a nice big radius that included Lincoln, NE (a college town) and Omaha, NE (a big city, for NE). They targeted women in a specific age range, and if I remember correctly only women with a status of Engaged or In A Relationship. I think they may have aimed for relevant keywords as well. (I personally don't know the exact details of their ads, so I'm sticking to what I know for sure.)
I can't think of a more ideal targeted advertising scenario, and they got less traction on Facebook than they did via AdWords. That's either a REALLY bad reflection on Facebook's ad platform, or a really good one for AdWords, or both.
(Their business is doing really well, for the record.)
Your friends probably tried to do the same thing that they were doing on AdWords, but targeting people instead of keywords. (I am assuming here, so please correct me if I'm wrong)
This doesn't work because they have to approach the people differently; for wedding planning, I would instead do something along the lines of "read these 10 tips to keep your wedding amazing" or "use our free wedding plan tracker"
With an approach based on interest, your friends can educate people and get them thinking in order to follow up for more information. Instead of a hard sell, hit them with a soft one that helps them feel like your friends know what they need.
Facebook ads would have to be really, really terrible for their claims to be true. According to another Forbes piece, $40M is not even 1% of GM's ad spend per year.
And this is where all the young consumers are spending hours per day. And lot of car ads are just about brand awareness; they don't depend on intent, or even clickthroughs. Seems fishy to me.
It really depends on what you are trying to sell. It's pretty obvious that car ads would work better on Google: when you are in the market for a new car, you'll definitely google review sites. A perfect hint to start showing car ads.
I don't think Facebook has the data yet to detect that you are about to buy a car. If you start liking car reviews, maybe, but that's not a typical behavior.
For other products (especially the ones you didn't know you needed), Facebook beats Google hands down. So don't pass judgment one way or another too quickly.
> I don't think Facebook has the data yet to detect that you are about to buy a car. If you start liking car reviews, maybe, but that's not a typical behavior.
I think they have the data, but maybe not the means to mine it. I'm guessing that people are interested in buying a new car at important life milestones and when replacing an older vehicle. It's pretty easy to find those milestones ("here's pictures of our new baby", "Grad 2015, whooooo", "Just started at my new job"). Signals for replacing an older vehicle could be looking up vehicle review pages on facebook (does edmunds.com have a facebook page?), like you mentioned.
So I don't think it's impossible (but definitely non-trivial). I have no idea if it's possible to target ads against the sorts of things people post to their wall/photo albums.
Your description reminds me of the Target/pregnancy story from a February[1]. The evidence there proves it's possible. The question then: Is Facebook's data as good as Target's? For Facebook, certainly. Can they get away with exposing that information to advertisers? I'm not sure.
You're confusing branding with direct call to action advertising. Two complete different things and priced differently. Big brands aren't going for the people about to buy a car, they are working way before that. By making you see the brand day after day it becomes ingrained so that when you are ready to buy a car you think GM.
Sure, because with traditional media, that was the best they could possibly hope for. In today's world of online comparison shopping, though, brands can easily close the deal for you with one click. (The fact that you can't buy a car with one click shows how hopelessly behind the industry is.)
It is not necessary to have an image of a brand planted in your mind before a purchase. It only matters that you're guided towards the brand when you are ready to buy. Advertisers were happy with a "brand image" before because it was the best they could do. But these days, it seems almost worthless.
(The fact that you can't buy a car with one click shows how hopelessly behind the industry is.)
Cars are, for most people anyway, the kind of really large purchase that requires a lot more effort and deliberation, not to mention financing, than makes sense to do in one click.
Until someone gamifies car purchasing, so that when I get 10,000 facebook points, I can redeem for a discount at my local GM dealership. Now that would be a great source of leads for car manufacturers.
I would love to decouple the showroom (sitting in the car, test drive, whatever) from the dealership. If a car manufacturer were to create a space were I could spend some quality time with the car without any threat of encountering a commissioned dealer, I would love it.
Then, I can choose where and how I buy the car later. The manufacturer would benefit from this no matter how I buy the car. Keeping these "shark-free-showrooms" stocked with demo cars, coffee, pastries, and branded swag would just be a general marketing expense.
With a click-through rate of about 0.051% on Facebook ads [1], I'm not too surprised by this. They also made some changes over the past month to their ad payments, in particular removing the option to manually set your CPM (which is the only option to pay to promote your fan page - it's CPC for an external site). So put together a poor CTR and losing some control over how much you're spending, and this is what happens.
Comparing click-through rate on a passive site like Facebook (I'm there to socialize and I might happen to see something interesting ad-wise) to an active site Google (I'm there to find a product) seems like a bad comparison. It seems like Facebook ad engagement should be measured my metrics closer to billboards.
0.051% is actually pretty good. Don't compare with Facebook, compare with other DSP and ad networks for banners - FB and Google are complete opposites.
That's not true, you can do either CPC or CPM for any kind of facebook ad; what they did do is replace the CPM functionality (which btw, is still available if you use a third party ad tool with facebook) with an "optimized CPM" which auto-bids for you according to what results you want to get.
Thanks, I'll have to look into the third-party tool option. Mostly I've been running ads with external links and it would only let me do CPC, but I did do it all thru fb's dashboard.
Banner ads are a relic of the 90s. I fully expect facebook to discontinue them eventually.
Because who cares if ads don't work? GM just endorsed sponsored content (to the tune of $30M, no less), a form of advertisement facebook can easily serve to their ever growing mobile user base.
Also, I'm not sure GM's marketing dept. is experienced in advertisement for online media
Sure, it's easy to advertise on FB (or Google Ads). It's a whole different story to make it effective.
Take Google AdWords. If you don't optimize your strategy you'll have a high CPC (cost per click), will probably pay for ineffective words. Also, there are changes you can do to your content (being advertised) that affect your CPC.
They certainly aren't mom and pop but it doesn't mean they are up to date
They may keep an old agency just for the sake of it, who may not be specialized in modern medias
And they can hire the best people for internet marketing just to end with their campaigns not approved by GMs marketing department, having to get something conservative (hence, ineffective)
Its obvious that Facebook ads don't work. How often you see a relevant Ad in Facebook? Almost never. So, advertisers show interesting images, but when you click on that image, it is some non-sense website. Facebook has some private information about the user, other than that FB has no clue what is my mood or what I am looking for. Its no wonder GM pulled out of Facebook.
I click on Facebook ads FAR more often than I click on Google ads. Actually, I don't remember the last time I clicked on a Google ad. Whereas Facebook shows me things I'm interested in all the time.
Anecdotal, but that seems to be what we're doing in this thread.
This is really not my experience. My facebook ads are so relevant that they almost seem like a useful service at times. It knows a few of the things I'm interested in thanks to who I'm friends with or pages i've liked or whatever - so I see ads for RC planes, chess software, local restaurants... the ads seem both more relevant and less spammy than my google ads.
This is interesting. I only "liked" friend posts or pictures. May if I "like" more direct things like restaurants, brands, facebook may be able to provide me a better "ad" experience. But, its good to know that it works for some people.
I work in facebook advertising and I'm still often surprised at the quality of some ads: recruiter ads targeted explicitly at my job title, ads from brands that want to drive engagement using facebook questions, etc.
The thing is, they don't. They really don't. I hardly even notice them, like there's some kind of mental block that prevents the brain from perceiving the ads. Same thing applies to Google ads, I completely ignore them. Has anyone else noticed such behavior in themselves?
Me too, for the most part I'm almost totally oblivious to them. I don't even bother with an ad blocker. I suppose it's the result of being bombarded with ads all my life, I'm immune to their charms.
LOL, and rain is wet.
The day a start-up comes with a reliable way to measure the true efficacy of online ads, no one will want to invest a penny in them.
My limited experience is that Facebook ads, for whatever reason, don't end up costing that much, whereas it's easy to piss tons of money away with Adsense. So I'm happier with the former.
The better educated you are, the more likely you won't consider GM to begin with .
(purely a guess based on anecdotal evidence ... the only guy I know with a Cadillac STS was a guy who only has high school and was a well-compensated salesman; but even he is now driving Audis)
That would be absurd. Anyone who would propose something like this at a GM board meeting would be marched out with all their personal belongings in a cardboard box.
Facebook's root problem is intent. Users who are googling something and seeing AdWords ads are looking for something and often the thing they're looking for shows up as an ad so they - suprise! - click the ad and often become a conversion once on the site.
With Facebook there is zero helpful intent. The only intent when you're on Facebook is to use Facebook. And if you do click an ad, you're less likely to become a conversion because your intent is still to get back to Facebook as soon as possible and see the rest of Dave's party photos or whatever.
I wouldn't say Facebook has a huge problem here - users spend much more time on Facebook than on Google (by design) and even if they don't intend to do anything other than "use Facebook", the ads are effective as a result of their high exposure.
That said, however, a very large group of users are there to play social games. With social game companies competing for ad space (for these often highly-profitable users), they're driving up the price of ads and making it less economical for other industries to advertise on Facebook.
When watching TV the intent is to watch TV, not purchase soap, a car, or a soft drink. It might be that Facebook's ads are simply the wrong type/style for the kind of interaction people use it for. It does seem like Facebook ads feel like Google search ads.
Or, TV ads don't actually work very well. Since we can't track conversions, we don't really know. Advertisers are paying for it, so why rain on the parade?
For brand advertisers like GM, intent is supposed to matter less. The lack of intent was always a known factor, but I personally expected big brands to be comfortable with Facebook's lower click through rates. The fact that they're not is a huge red flag.
True, but my impression is that most Facebook ads feel like performance ads and not display ads. I don't recall seeing GM ads on Facebook, but I would bet that they look and feel like performance ads and not display ads.
I assure you that plenty of Facebook employee time was likely spent trying to optimize their campaigns. Ten million dollar clients don't learn; they're taught.
Intent is huge. I've never been one to click on Google Ads except in real rare instances. Only once I observed my mom using Google did I realize the full value of intent and google ads while searching.
She wanted to watch an episode of The Good Wife that she had missed so she searched in the Safari omnibar for "watch The Good Wife" and the first div under the search bar is an ad to some site that was not CBS that had the Good Wife available to watch via streaming video. To you and I, it's obvious that this "first result" is ad and we would skip over it to the first result. But to my mom, she thinks it's a search result and clicks on it. When she arrives on the site she thinks she's on the CBS site because they naively assumes like many consumers that the site showing the content would be CBS. She doesn't even think twice about the identity. When you are used to TV, you blindly trust that the site/channel showing the content is the correct one.
The only reason I discovered this was because she asked me to pull up The Good Wife to watch on CBS. I, being a savvier internet user, just navigated straight to cbs.com to search there. I got to their Good Wife site and lo and behold, there is no streaming video available on CBS, only teasers and behind the scenes content. I told my mom that "No, CBS doesn't have it on their site" and she was like "Yeah they do. I watch it all the time". I then asked her to show me exactly how she found it on CBS and that was when she showed me that she in fact was clicking on the ad in Google Search between the search box and the search results thinking it was in fact the first result. That's the power of intent and Facebook doesn't have that.
"That's the power of intent and Facebook doesn't have that."
Sure they do...
Status Update from malandrew's mom: "OMG I can't wait to watch the new episode of The Good Wife tonight!"
Facebook ads: "Click here to watch The latest Episode of the Good Wife"
Facebook could has something better than Google intent in that they should be able to predict what you intend to search for before you go looking for it.
Facebook could has something better than Google intent in that they should be able to predict what you intend to search for before you go looking for it.
You could say that Google responds to your demand while Facebook (at least in potential) creates new demands.
If we're still going with the given example, Facebook didn't create anything except a forum where a mom posted a status update.
There's no reason for an advertiser to pay to serve an ad for that. The ad was just given away for free. Unless you want to watch the show right at that moment, you wouldn't click it anyway.
So, I'm missing the part where Facebook can monetize the "new demands."
I was going with the example of Facebook using their knowledge my tastes, as well as the tastes of millions of people who are somewhat like me, to introduce me to things that I would have a legitimate interest in, even if I'm not searching for them.
Example: Subject is a coffee-drinking, Vespa-riding, snappy-dressing, backyard chicken-farming, photo-snapping, game-playing father of two small children. He's not looking for bluetooth cuff links, but we know that once he sees them, he'll be likely to buy because that's what other people in his micro-niche tend to buy.
When you want to search something, do you first go to your facebook account and tell your friends "hey, I want to learn more about x!" and then go to your favorite search engine, and actually do your search?
I bet you don't.
In your example, if the mom is saying "tonight", it probably means that she wants to see it "tonight" (maybe she doesn't have the time right now). so, they should try to make the ad really visible that very night, so the user (this mum) will see it before she even goes to look for it anywhere else.
But that would feel very creepy. She would think "how did they knew I wanted that?". It would feel like if someone is spying her. I think the average people is ok to have ads displayed while searching (maybe they will not even notice that some "results" are ads). But when the ads start having a very direct relation to what people posts, they start to worry about their privacy.
What I mean is... sure, facebook could infer the user intention, but in comparison, a search engine has it almost served.
It is a successful tool for ad networks to provide because advertisers pay more for it, I've yet to be convinced that it actually increases conversions. If I keep seeing an ad over and over again, I just get annoyed.
I've seen the number, it converts far, far better than average ads. On the order of 10X, for the campaigns I've seen. That's partially because clickthrough rates overall keep dropping, but still, they're really effective.
Yes, it's annoying if you're in the 95% of customers who won't actually convert. But it only has to be effective about 1 out of 20 times to be a huge improvement (and that 1 might even be you, but you're mostly annoyed by the other 19 times.)
I think retargeting is really only creepy for people like us who are smart enough to link the retargeting back to our identity because we are logged into google.
My mom (again) is subjected to retargeting, but she doesn't identify it as tied to her identity so much as tied to the current search. She uses gmail for work and her personal account (because i set up a google apps account for her), but I doubt she knows that just because she's logged into gmail that google search is tying that information back to her identity.
This is a far cry from Facebook where people know that things in Facebook are tied back to their identity, and not only that is tied back to their identity in a way that may be visible to friends and family.
Both Google and Facebook track you, but Facebook is personal, and people are aware of that fact.
Most people on Facebook talk about what HAS happened, even if it's just happened on their minds. Their intent is already elsewhere. In your example, that person has mentally scheduled to watch it tonight. If she wanted to watch it earlier, she would be googling it right after posting that to FB.
If FB decides to infer intent from posts right away (when the post's content could be relevant to intent) and adopt a role of 'online assistant' with automatic instant suggestions, that will be creepy and, considering the amount of colorful emotions often present in FB posts, is sure going to cause a few interesting situations. But that's a hugely different product from the Facebook and the ad industry as we know it.
It seems to me like even if it was an ad, your mom's usage connected intent with desired result better than yours. Obviously confusion isn't great, but what she said she wanted to do was "watch the Good Wife", not "watch the Good Wife on CBS".
Ironically, yes, definitely. I almost never watch TV, but I would have gone straight to the Pirate Bay if I were to watch it myself, because I doubted that and cable channel except Comedy Central would allow me to watch something streaming on demand from their site. TBH, when she said she had watched it on CBS' site I was skeptical.
I know illegitimate streaming sites exist out there, but I kind of assume they are ad riddled and provide a poorer experience than torrents.
I guess you could say it's one spin on the curse of knowledge.
Facebook has ads that people like your mother will think are from friends. If users can't tell the different between Google Ads and search terms (or between CBS and a random site), they're unlikely to distinguish between newsfeed updates from friends and paid ads.
You're right that that's totally different from intent. But it's valuable for brands which spend billions [1] per year on exposure-focused ads, like product placement.
If users can't tell the different between Google Ads and search terms (or between CBS and a random site), they're unlikely to distinguish between newsfeed updates from friends and paid ads
That's a big assumption to make. The bar is low for search results because they have no personality.
For friends -- we know our friends. They have a distinct personality. Ads disguised as messages from friends could have a negative effect because of this dissonance.
Typically when someone "likes" a product or service, that shows up as the ad. For example, my father "liked" Carnival cruises, this makes sense as he's been searching for a cruise lately. The ad showed his picture next to a Carnival ad. It looks very authentic if you're not paying close attention.
Can you link to some screenshots with examples of ads in the newsfeed that someone like my mother would confuse as being from a friend or family member?
I'm inclined to agree with davvid on his point about how personality isn't a distinguishing factor between Google Ads and Google Search Results.
On top of that, intent is was drives the conversion. Even if my mom were to inadvertently click on an ad in her newsfeed thinking it was from a family member, the content of the page she was redirected to would definitely let her know she had made a mistake and that the status update definitely wasn't from a friend or family member.
>With Facebook there is zero helpful intent. The only intent when you're on Facebook is to use Facebook.
This might be the case right now, but what about in the future? I think that's what Google et al. are scared about. If users spend 90% of their internet time on Facebook, and Facebook figures out how to serve users with "What they are looking for" 5 years down the road, then users will have a very low barrier to trying out the Facebook "look-up" service.
Right now, my use of the internet is (1) sites I already know exist, or (2) Google, in order to find things.
What if this becomes (1.1) Facebook, to look at things served from other sites that I like, and (1.2) Facebook, to find things that I don't know about?
That's scary for companies counting on the status quo. Sites' share of user time is important not for how they are now, but how things might become in the future. It's a huge about of leverage.
> With Facebook there is zero helpful intent. The only intent when you're on Facebook is to use Facebook.
It isn't about intent - it is about interest.
> And if you do click an ad, you're less likely to become a conversion because your intent is still to get back to Facebook as soon as possible and see the rest of Dave's party photos or whatever.
Not necessarily. I'm working with a customer right now where I have a 24% conversion rate on movie tickets. They routinely shell out $7-$21 a pop with this conversion rate; the catch is, I have to be very careful about who I target.
This kind of trend goes across the entire industry of FB ads - target well, optimize and approach based on interest and the money will follow.
Interest can be quite enough; I'd also say that GM's is the exception instead.
Generally speaking, the majority of online advertising is geared toward interest in the first place because interest leads to intent. Facebook is earlier in the customer acquisition lifecycle as you can grab their interest before the intent, and then they'll go directly to you instead of searching.
This is why Google in general has been so scared of Facebook (not that I think they should be). What is happening is that people are figuring out ways to cut search out of the loop.
Take a look at all those online games you see on FB ads now. I can tell you that most of the MMO ad budget now goes to Facebook as you can easily get people to download the game and start playing, whereas trying to pick people off search for MMO's is obscenely expensive. As search saturates, marketers tend to move towards the point of greatest ROI, which happens to be in the interest phase.
Cars are a tough sell, no matter where you try. I'm not saying that every single type of product works on FB, just that we really should not compare FB to AdWords in the first place.
"Prove the rule" is a colloquialism that means "test the rule". The exception ends up disproving or clarifying the rule, not verifying it. It doesn't mean prove like passing that test.
Actually, "the exception that proves the rule" means that a recorded exception to a rule can be used as proof of the existence of an otherwise undocumented rule. It dates back to medieval legal terminology.
Well it does not seems to be all about intent or interest, but just two distinct ways to provide insightful advertising.
But still, the intent model of google adwords seems so much more stronger, whereas facebook's interest model just look like a centralized and refined adsense. Google has long given emphasis to the long tail, the specialized interest that bring as much revenue as the mainstream one.
The intent model is clearly stronger here, as searches have an explicitly parameterized specific content, whereas the interest model can only bring up revenue on frequent and common patterns (such as you say, movie tickets), since you cannot anticipate rarely occurring interests.
I've actually been interested in a handful of things I've seen as Facebook ads. They are generally things that I didn't know existed, wasn't actively shopping for, and sure as heck wasn't searching for. Example: http://www.mushroomnetworks.com
If anyone is going to get any sort of value out of the wealth of information I've given away about myself, it's going to be the person who opens my eyes to something new and awesome that speaks to my... unique tastes.
GM can't really be new or awesome anymore, and that's OK.
I agree, and I think that the Facebook ads with the highest potential are for products that fall in the disposable income/non-considered purchase/splurge categories.
I'm not likely to see an ad for a GM product and immediately run out and buy one (and I'm guessing this is true for 99% of Facebook users). But I have seen ads, and posts by friends, for random products in the $10-$500 range related to things I didn't necessarily need (or know existed), that HAVE influenced my purchasing decisions.
Facebook is a new and different advertising channel, much like Google and Internet ads were before it, and companies and agencies need to adapt accordingly to this.
If you've been around long enough, you might remember stories from the late 90's from companies that both swore by, and swore off, Internet advertising...
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[ 4.1 ms ] story [ 292 ms ] threadI work at a online advertising firm in DC specializing in political and non-profit work - mostly email list building, soliciting volunteers, awareness, etc campaign activities. We work with AOL, Yahoo, Google and Facebook, among many others.
I'm not a fan of FB's policies in general, but... We've found FB to be very effective - on a cost per acquisition basis, much more so than search advertising and on par with other vehicles.
Obviously, test to see what's effective for your needs, but I wouldn't rule out Facebook based on GM's experience. Cars are an unusually high involvement purchase, unlike most things people would be advertising.
I guess it's because of the demographics (as someone said, facebook moms with free time - and a soft heart).
Anecdotal evidence, but I've heard it's very good for small shops targeted for women, and my girlfriend did buy from a facebook ad.
Meanwhile, I imagine that people don't really share things like "I really like the new model of the Cadillac XYZ!". Maybe they think that their friends will view it as shallow gloating; maybe you don't want to reveal the fact that you bought a new car.
Facebook revolves around "Sharing of information". Brands that have values that users want to share with their friends will do well. Those that can make users think twice about sharing (even if they really do like the brand) may fare worse.
Problems like Republicans attempting to take advantage of your presence to poke fun of you as "government motors". :)
The best marketing on Facebook doesn't make Facebook any money.
> GM spends about $40 million on its Facebook presence. About $10 million of that is paid to Facebook for advertising, the rest covers content created for the site, agencies that manage the content and daily maintenance of GM's pages, people familiar with the figures said.
I admit I've never worked at GM, so if someone can tell me why I'm wrong, please do.
If they were using that additional $10mm to get the 300k followers to begin with, that's an even worse indictment of FB advertising for traditional brands.
That's a factor of 10 more than you were estimating; and that's just based on a quick poll of brands that I took a look at.
It could very well include the cost of creation of video content, contest giveaways, promotional prizes and such.
Once you add all that all up, $30 million doesn't seem as far fetched .....
Also GM sells a few dozens models of cars, I could easily see the salaries for the staff who do daily updates for all these models and the advertising agencies who manage it costing 30 million or more.
Also GM has annual revenue of almost 160 BILLION, 30 million is a drop in the bucket in their marketing budget.
You'd think so, but apparently not, if they're making a big stink over pulling a $10mil marketing campaign. Apparently, $10mil matters to them.
Advertising agency doesn't sell you a great campaign, idea or pretty pictures.
they sell you media. with a HUGE markup.
10mil media can cost way more than 30mil if bought from an agency creating the 'creatives' (in the case of car ads, a picture of the car, or a movie of it cruising on a road where the art director likes to take vacations)
30mil for 10mil of media, GM had a good deal.
The agencies don't get the markup the media buying companies do. They are to the advertising industry what realtors are to the housing market.
Most of the houses have no idea what they are doing, which only works because their clients are even more clueless.
It will change within the next 5 years and the media buying houses will be mostly gone with a few exceptions.
I'm curious what your thoughts are from there? Who does the purchasing?
Don't tell me it's all going RTB or something like that; premium advertising is still how the publishers are going to make money and you really can't automate that.
You are going to need high touch sales presence, bespoke custom executions, etc.
I'm definitely not going to miss the buyers.
And the big agency would go nowhere if it actually had to do the creative work.
and yes, when the client is clueless, there's lot of people in the way making money.
In any case a lot of people here, as another poster said, are confusing direct advertising with branding. I'm not in the market for a new car, but if I'm on Facebook, it's more than likely because I'm bored. If a car ad that looks good is on the page I'm on, I'm likely to click on it and look at the car. A year or two from now when I might be in the market, that make of car I keep seeing on FB is likely to be on my mind as a possible candidate.
And now that I think of it, I keep seeing brand new GM Yukons on the road and I like the way they look and they look like they are good tow vehicles. If I saw a Yukon ad on facebook, odds are I will click through.
http://blog.foundrs.com/2011/04/01/sell-your-google-stock-li... (the blog post shows early numbers, the real numbers, after longer experimentation, show the exact same results)
edit: for that reason, I think Facebook advertising does not work. Or at least, does not work for the _most_ of advertisers. Its just that Facebook is still new and here and there I hear my friends being exciting about "advertising to millions of customers" and they do give it a shoot with a poor results at the end. The point is you have so many people that havent tried that yet that they still bringing cash to FB. But unless FB does something for the ads to work (change its core product?), the $ numbers will only fall.
There is no way for GM to pull this kind of maneuver at this time without looking suspicious.
Not that that precludes the possibility that Facebook ads don't work.
It would certainly be better for Facebook if this were a conspiracy, but I don't believe that's what's happening here.
relevant: http://www.themillions.com/2012/04/the-berenstain-bears-and-...
Two of my friends run a wedding planning business. They gave up on targeted Facebook ads because they got MUCH better results using Adwords.
The ads were targeted to a nice big radius that included Lincoln, NE (a college town) and Omaha, NE (a big city, for NE). They targeted women in a specific age range, and if I remember correctly only women with a status of Engaged or In A Relationship. I think they may have aimed for relevant keywords as well. (I personally don't know the exact details of their ads, so I'm sticking to what I know for sure.)
I can't think of a more ideal targeted advertising scenario, and they got less traction on Facebook than they did via AdWords. That's either a REALLY bad reflection on Facebook's ad platform, or a really good one for AdWords, or both.
(Their business is doing really well, for the record.)
This doesn't work because they have to approach the people differently; for wedding planning, I would instead do something along the lines of "read these 10 tips to keep your wedding amazing" or "use our free wedding plan tracker"
With an approach based on interest, your friends can educate people and get them thinking in order to follow up for more information. Instead of a hard sell, hit them with a soft one that helps them feel like your friends know what they need.
http://www.forbes.com/sites/rebeccalindland/2012/05/15/gms-f...
And this is where all the young consumers are spending hours per day. And lot of car ads are just about brand awareness; they don't depend on intent, or even clickthroughs. Seems fishy to me.
Lower price? Oh hey maybe we will try again!
I don't think Facebook has the data yet to detect that you are about to buy a car. If you start liking car reviews, maybe, but that's not a typical behavior.
For other products (especially the ones you didn't know you needed), Facebook beats Google hands down. So don't pass judgment one way or another too quickly.
I think they have the data, but maybe not the means to mine it. I'm guessing that people are interested in buying a new car at important life milestones and when replacing an older vehicle. It's pretty easy to find those milestones ("here's pictures of our new baby", "Grad 2015, whooooo", "Just started at my new job"). Signals for replacing an older vehicle could be looking up vehicle review pages on facebook (does edmunds.com have a facebook page?), like you mentioned.
So I don't think it's impossible (but definitely non-trivial). I have no idea if it's possible to target ads against the sorts of things people post to their wall/photo albums.
[1]: https://news.ycombinator.com/item?id=3601354
It is not necessary to have an image of a brand planted in your mind before a purchase. It only matters that you're guided towards the brand when you are ready to buy. Advertisers were happy with a "brand image" before because it was the best they could do. But these days, it seems almost worthless.
Cars are, for most people anyway, the kind of really large purchase that requires a lot more effort and deliberation, not to mention financing, than makes sense to do in one click.
Then, I can choose where and how I buy the car later. The manufacturer would benefit from this no matter how I buy the car. Keeping these "shark-free-showrooms" stocked with demo cars, coffee, pastries, and branded swag would just be a general marketing expense.
[1] http://www.kikabink.com/news/facebook-ad-click-through-rates...
That's not true, you can do either CPC or CPM for any kind of facebook ad; what they did do is replace the CPM functionality (which btw, is still available if you use a third party ad tool with facebook) with an "optimized CPM" which auto-bids for you according to what results you want to get.
You can still set a manual max bid though :)
Because who cares if ads don't work? GM just endorsed sponsored content (to the tune of $30M, no less), a form of advertisement facebook can easily serve to their ever growing mobile user base.
Sure, it's easy to advertise on FB (or Google Ads). It's a whole different story to make it effective.
Take Google AdWords. If you don't optimize your strategy you'll have a high CPC (cost per click), will probably pay for ineffective words. Also, there are changes you can do to your content (being advertised) that affect your CPC.
They may keep an old agency just for the sake of it, who may not be specialized in modern medias
And they can hire the best people for internet marketing just to end with their campaigns not approved by GMs marketing department, having to get something conservative (hence, ineffective)
Anecdotal, but that seems to be what we're doing in this thread.
Google excels at advertising things people do search for.
(purely a guess based on anecdotal evidence ... the only guy I know with a Cadillac STS was a guy who only has high school and was a well-compensated salesman; but even he is now driving Audis)
That's based pretty heavily on your personal social circle, I suspect. It doesn't match with mine at all.
Theres a huge risk that would fail.
With Facebook there is zero helpful intent. The only intent when you're on Facebook is to use Facebook. And if you do click an ad, you're less likely to become a conversion because your intent is still to get back to Facebook as soon as possible and see the rest of Dave's party photos or whatever.
That said, however, a very large group of users are there to play social games. With social game companies competing for ad space (for these often highly-profitable users), they're driving up the price of ads and making it less economical for other industries to advertise on Facebook.
The difference being that facebook doesn't make you watch a 10 second ad between each one of Dave's party photos.
She wanted to watch an episode of The Good Wife that she had missed so she searched in the Safari omnibar for "watch The Good Wife" and the first div under the search bar is an ad to some site that was not CBS that had the Good Wife available to watch via streaming video. To you and I, it's obvious that this "first result" is ad and we would skip over it to the first result. But to my mom, she thinks it's a search result and clicks on it. When she arrives on the site she thinks she's on the CBS site because they naively assumes like many consumers that the site showing the content would be CBS. She doesn't even think twice about the identity. When you are used to TV, you blindly trust that the site/channel showing the content is the correct one.
The only reason I discovered this was because she asked me to pull up The Good Wife to watch on CBS. I, being a savvier internet user, just navigated straight to cbs.com to search there. I got to their Good Wife site and lo and behold, there is no streaming video available on CBS, only teasers and behind the scenes content. I told my mom that "No, CBS doesn't have it on their site" and she was like "Yeah they do. I watch it all the time". I then asked her to show me exactly how she found it on CBS and that was when she showed me that she in fact was clicking on the ad in Google Search between the search box and the search results thinking it was in fact the first result. That's the power of intent and Facebook doesn't have that.
Sure they do...
Status Update from malandrew's mom: "OMG I can't wait to watch the new episode of The Good Wife tonight!"
Facebook ads: "Click here to watch The latest Episode of the Good Wife"
Facebook could has something better than Google intent in that they should be able to predict what you intend to search for before you go looking for it.
You could say that Google responds to your demand while Facebook (at least in potential) creates new demands.
There's no reason for an advertiser to pay to serve an ad for that. The ad was just given away for free. Unless you want to watch the show right at that moment, you wouldn't click it anyway.
So, I'm missing the part where Facebook can monetize the "new demands."
Example: Subject is a coffee-drinking, Vespa-riding, snappy-dressing, backyard chicken-farming, photo-snapping, game-playing father of two small children. He's not looking for bluetooth cuff links, but we know that once he sees them, he'll be likely to buy because that's what other people in his micro-niche tend to buy.
When you want to search something, do you first go to your facebook account and tell your friends "hey, I want to learn more about x!" and then go to your favorite search engine, and actually do your search?
I bet you don't.
In your example, if the mom is saying "tonight", it probably means that she wants to see it "tonight" (maybe she doesn't have the time right now). so, they should try to make the ad really visible that very night, so the user (this mum) will see it before she even goes to look for it anywhere else. But that would feel very creepy. She would think "how did they knew I wanted that?". It would feel like if someone is spying her. I think the average people is ok to have ads displayed while searching (maybe they will not even notice that some "results" are ads). But when the ads start having a very direct relation to what people posts, they start to worry about their privacy.
What I mean is... sure, facebook could infer the user intention, but in comparison, a search engine has it almost served.
Yes, it's annoying if you're in the 95% of customers who won't actually convert. But it only has to be effective about 1 out of 20 times to be a huge improvement (and that 1 might even be you, but you're mostly annoyed by the other 19 times.)
My mom (again) is subjected to retargeting, but she doesn't identify it as tied to her identity so much as tied to the current search. She uses gmail for work and her personal account (because i set up a google apps account for her), but I doubt she knows that just because she's logged into gmail that google search is tying that information back to her identity.
This is a far cry from Facebook where people know that things in Facebook are tied back to their identity, and not only that is tied back to their identity in a way that may be visible to friends and family.
Both Google and Facebook track you, but Facebook is personal, and people are aware of that fact.
Maybe the user will watch on TV. You can't tell if the user is actually looking for a way to watch the show.
If it's on Google though, the intent is much clearer.
If FB decides to infer intent from posts right away (when the post's content could be relevant to intent) and adopt a role of 'online assistant' with automatic instant suggestions, that will be creepy and, considering the amount of colorful emotions often present in FB posts, is sure going to cause a few interesting situations. But that's a hugely different product from the Facebook and the ad industry as we know it.
I know illegitimate streaming sites exist out there, but I kind of assume they are ad riddled and provide a poorer experience than torrents.
I guess you could say it's one spin on the curse of knowledge.
You're right that that's totally different from intent. But it's valuable for brands which spend billions [1] per year on exposure-focused ads, like product placement.
[1] http://adage.com/article/madisonvine-news/product-placement-...
That's a big assumption to make. The bar is low for search results because they have no personality.
For friends -- we know our friends. They have a distinct personality. Ads disguised as messages from friends could have a negative effect because of this dissonance.
I'm inclined to agree with davvid on his point about how personality isn't a distinguishing factor between Google Ads and Google Search Results.
On top of that, intent is was drives the conversion. Even if my mom were to inadvertently click on an ad in her newsfeed thinking it was from a family member, the content of the page she was redirected to would definitely let her know she had made a mistake and that the status update definitely wasn't from a friend or family member.
http://www.cbs.com/shows/the_good_wife/video/
:)
This is very true. I only go to Facebook to use Facebook.
This might be the case right now, but what about in the future? I think that's what Google et al. are scared about. If users spend 90% of their internet time on Facebook, and Facebook figures out how to serve users with "What they are looking for" 5 years down the road, then users will have a very low barrier to trying out the Facebook "look-up" service.
Right now, my use of the internet is (1) sites I already know exist, or (2) Google, in order to find things.
What if this becomes (1.1) Facebook, to look at things served from other sites that I like, and (1.2) Facebook, to find things that I don't know about?
That's scary for companies counting on the status quo. Sites' share of user time is important not for how they are now, but how things might become in the future. It's a huge about of leverage.
It isn't about intent - it is about interest.
> And if you do click an ad, you're less likely to become a conversion because your intent is still to get back to Facebook as soon as possible and see the rest of Dave's party photos or whatever.
Not necessarily. I'm working with a customer right now where I have a 24% conversion rate on movie tickets. They routinely shell out $7-$21 a pop with this conversion rate; the catch is, I have to be very careful about who I target.
This kind of trend goes across the entire industry of FB ads - target well, optimize and approach based on interest and the money will follow.
Go watching a movie are such an ingrained part of life for many people and thus we are always "on the look" for a good movie to go watch.
But try and do that with a car brand or any other non-commodity and intent suddently becomes the most important factor.
Generally speaking, the majority of online advertising is geared toward interest in the first place because interest leads to intent. Facebook is earlier in the customer acquisition lifecycle as you can grab their interest before the intent, and then they'll go directly to you instead of searching.
This is why Google in general has been so scared of Facebook (not that I think they should be). What is happening is that people are figuring out ways to cut search out of the loop.
Take a look at all those online games you see on FB ads now. I can tell you that most of the MMO ad budget now goes to Facebook as you can easily get people to download the game and start playing, whereas trying to pick people off search for MMO's is obscenely expensive. As search saturates, marketers tend to move towards the point of greatest ROI, which happens to be in the interest phase.
Cars are a tough sell, no matter where you try. I'm not saying that every single type of product works on FB, just that we really should not compare FB to AdWords in the first place.
http://en.wikipedia.org/wiki/Exception_that_proves_the_rule
But still, the intent model of google adwords seems so much more stronger, whereas facebook's interest model just look like a centralized and refined adsense. Google has long given emphasis to the long tail, the specialized interest that bring as much revenue as the mainstream one.
The intent model is clearly stronger here, as searches have an explicitly parameterized specific content, whereas the interest model can only bring up revenue on frequent and common patterns (such as you say, movie tickets), since you cannot anticipate rarely occurring interests.
If anyone is going to get any sort of value out of the wealth of information I've given away about myself, it's going to be the person who opens my eyes to something new and awesome that speaks to my... unique tastes.
GM can't really be new or awesome anymore, and that's OK.
I'm not likely to see an ad for a GM product and immediately run out and buy one (and I'm guessing this is true for 99% of Facebook users). But I have seen ads, and posts by friends, for random products in the $10-$500 range related to things I didn't necessarily need (or know existed), that HAVE influenced my purchasing decisions.
Facebook is a new and different advertising channel, much like Google and Internet ads were before it, and companies and agencies need to adapt accordingly to this.
If you've been around long enough, you might remember stories from the late 90's from companies that both swore by, and swore off, Internet advertising...