If you read any other news other than auto news, then you know that social-networking giant Facebook is on its way to file an IPO later this week. Facebook plans on offering its shares for $34 to $38 per share, putting the company’s valuation at $93 billion to $104 billion.
While things may sound all nice and peachy, Facebook is facing a lot of scrutiny from investors and advertisers. According to a new AP-CNBC poll, 57 percent of Facebook users say they never click ads or other sponsored content. Only about 4% of users say they often click on ads.
So what does this have to do with the automotive industry? General Motors has just said that it will stop advertising on Facebook, citing the ‘ineffectiveness of paid ads,’ according to The Wall Street Journal.
GM spends about $40 million to maintain all aspects of its Facebook marketing ($10 million on paid ads). That really puts things into perspective as to how much other companies probably dump into the social-networking website.
GM’s Joel Ewanick, head of marketing at the company, said that the company will still make use of the free Facebook pages for marketing.
– By: Omar Rana