Monday, May 21, 2012

GM Going 'Hipster'

First Facebook, now the Super Bowl? In case you haven’t heard yet, GM has made some serious changes to its marketing efforts over the past few days. First, the well-known automotive company cut its ties to Facebookadvertising just days before the social media sites IPO. Then a few days later GM declared that it would no longer sponsor the 2013 Super Bowl. So what’s going on here? Has the marketing department decided to go ‘hipster’ and cut out any sort of advertising that’s mainstream? Why would GM cut its two marketing campaigns that reach the most viewers? One word: Price.

Let’s first start with Facebook. The social media site warnedcompanies a few months ago that just having a Facebook page would not be enough to become relevant in the social media world. GM, like many companies, decided at this point or beforehand that they agreed with the statement from Facebook and purchased advertising on the site. However, now GM is pulling all of its paid advertisements from the site but will continue to operate is free page. Why the sudden change of heart? According to its internal research, the automotive company discovered that the Facebook advertisements were not quite as effective per dollar as they had thought. There are many companies and competitors, however, that still believe that Facebook advertisements are worth, including Ford (which recently decided to increase its Facebook ads).

A more interesting and shocking cut that GM made is its sponsorship of the 2013 Super Bowl. While Facebook reaches many viewers, how many of them ACTUALLY read look at the ads (don’t lie…you know you ignore them). The Super Bowl, however, is the Nation’s Biggest Stage not for the game that is being played, but for something almost as entertaining: THE COMMERICALS! Why on Earth anyone could decide that advertising in the Super Bowl was just not worth the cash anymore is beyond me. Yes, the prices have risen over the past few years and are projected to increase yet again this year (2012: 3.5 million per 30-second spot; 2013 – projected: 4 million per 30-second spot). But it’s THE SUPER BOWL, almost every American watches it! How is 4 million dollars not worth reaching roughly 300 million potential customers at once? We are talking about the nation’s third largest advertiser that spent about 2.8 BILLION dollars last year on domestic advertising. Does a half million dollar-per-commercial really effect the budget THAT much? I doubt it.

While I can easily justify in my mind the cutting of Facebook advertisements, I am having great difficulty in wrapping my head around GM’s reasons for cutting its sponsorship to the Super Bowl. What are your thoughts? Have the marketers at GM lost it? Is Facebook (or Super Bowl) advertisements that effective/ineffective? Comment below!

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