Just as Facebook prepares for its big IPO this week, the Wall Street Journal is reporting, automotive giant, General Motors plans to drop its Facebook advertising.
A spokesman for the U.S. automaker confirmed, saying that GM's marketing executives had determined that Facebook's ads had little impact on consumers. According to the Journal, GM marketing chief Joel Ewanick said the auto maker, "is definitely reassessing our advertising on Facebook, although the content is effective and important.”
According to new figures by WordStream, Facebook ranks incredibly low as far as click-through rates (CTR) go. The average CTR for an online ad is just 0.1 per cent. Google has an above average CTR, standing at 0.4 per cent. Facebook, however, has a lowly CTR of 0.051 per cent.
So what does this mean?
Is Facebook an effective medium for advertising? If a big brand like GM with a wide audience range can't hack it, will Facebook advertising continue to gain success?
I almost fear that this very public display of GM's dissatisfaction with Facebook ads will cause other companies to re-evaluate their ROI and possible follow suit and abandon ship.
What do you think? I'm interested in hearing your opinion on this topic. Could this be Facebook downfall--or at least it's biggest flop to date? What can Facebook do to entice users to click and interact with the online ads?
Join the discussion! Leave thought thoughts in the comments below!
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