Who's REALLY at Fault for GM's Facebook Ad Failure?

by Dan Slagen

Date

May 18, 2012 at 12:00 PM

gm facebook adsintermediate

"Facebook ads suck." For many companies, advertising on Facebook and expecting a return is a "fantasy." If you clicked those hyperlinks, you found just two examples in the flurry of negative press surrounding Facebook advertising of late -- all stemming from the recent GM announcement to cut $10 million in paid ad spend on the social network.

It makes you wonder what prompted this announcement from GM. Is this a media tactic to help searches for GM? Or were the results of Facebook advertising really so miserable that it warranted this media attention? Who knows -- the onslaught of coverage wasn't accompanied by a leak of GM's analytics. One thing that is evident is that GM hasn't had much visible success from digital advertising in general; just take a look at what Google's Insights for Search tool had to show.

GM Trends

But is GM truly the digital marketing icon that we should be referencing to determine whether or not Facebook ads work? What about a brand like Southwest? They run Facebook ads quite frequently ... how are they faring? Actually, they've been able to generate a ton of positive mentions in the same time period as compared to GM:

Southwest

From this perspective, maybe it's the Southwests of the world we should look to for guidance when it comes to digital ad success, not GM. What is clear is that we must have data points and ask the right questions -- not just have opinions when it comes to determining the value in something like Facebook ad spend. Because the only answer to the question of whether Facebook ads work or not is “it depends.” While this response is typically an advertiser's way of sidestepping a direct question, I mean it sincerely, and here's why.

Just as with any marketing initiative, to run a successful Facebook marketing campaign, companies (especially those with a $10 million budget) need to consider many factors before even logging into their Facebook account.

11 Planning Considerations Before Starting a Facebook Campaign

1) Set your goals. Do you want fans? Conversions on Facebook? Conversions off of Facebook onto a landing page? What about leads, qualified leads, sales, revenue and ROI?

2) Determine your market size. How large is your audience, and what can you realistically expect from advertising on Facebook? Are there 2 million people that you can target, or only 1,000? Don't be surprised to find out that the market for niche groups is often larger than you think. For instance, there are 127,000 people in the United States alone that list Agatha Christie as an interest -- not bad for a British crime novelist that passed away in 1976.

AC

3) Set a budget. Have you budgeted enough for your campaign, or too much? If you've set aside too much, you'll likely be disappointed with your results as you're pushing budget to the point of inefficiency. If you haven't set aside enough, you'll spread yourself too thin and your reach/frequency won't be strong enough to target your core audience.

4) Take seasonality into account. Mindsets change during summer months. Ecommerce budgets, for example, are typically much heavier in Q4. Market costs can increase during certain months of the year, or during years with major elections. Are you thinking about all of the external factors that could be impacting your campaign?

5) Consider the day of the week. Ad performance varies by day, especially from weekday to weekend. Understanding which days perform best for your company is vital so your budget doesn't go to waste. For example, if you're looking to drive users to your website to convert on a "Talk to Sales" call-to-action, you need to make sure that you have the proper staff working during the days these campaigns are live.

6) Use day parting. What hours of the day are the most effective to run your ad? When does your specific audience show the highest engagement rates? If you understand this, you'll be able to get the most of out your ads and push them harder during your most efficient times.

7) Consider the decision process. What are you asking users to do? What are they thinking about when they see your ad? An example of a decision process might be:

Recognizes Need >> Performs Informational Search >> Evaluates Options >> Makes Purchase

If you know this, you can get in front of users with those needs, have a conversation trigger, educate them, and nurture them through the sales process.

8) Determine your target demographic. You could consider age, social class, gender, family size, income, occupation, lifestyle, education, religion, and race and nationality.

9) Determine your audience's psychographics. Ask yourself these questions about your target market (TM):

  • What does the TM like/dislike about your product or service?
  • What does the TM like/dislike about your competitor's product or service?
  • What is the trigger that sparks conversion?
  • Is there brand awareness?
  • Were there influencing factors from other marketing campaigns prior to converting?
  • Is disposable income a factor in the sales cycle?
  • Are there emotional factors at play during the conversion cycle?
  • What social class does the TM fall into?
  • Who is the decision maker, as opposed to just helping evaluate options?
  • Are there specific values that your TM identifies with?
  • Are there hobbies or interests that would help define your TM?

10) Do your geo-targeting. When targeting ads, you should consider country, region, state, designated marketing area, city, town, and zip code.

11) Don't forget about the customer service experience. Like we mentioned before, if you're directing people to speak to someone at your company, experience matters. Will they talk to a live person who is knowledgeable about their questions? How long did the phone ring before the call was answered? Was the experience the same at 7AM as it was at 4PM? What about on Monday, versus Saturday? If the follow-up was via email, was it timely, friendly, and helpful? You should provide a consistent experience from initial ad impression to customer service interaction.

Once all of those details have been accounted for, then you're ready to start spending money on Facebook ads. Why? Because it's easy to generate clicks from a Facebook campaign, but the post-click experience is where the true expertise -- and ROI -- comes into play. From the ad, to the landing page, to the customer service experience, it takes a team effort from Marketing and Sales to convert leads and customers.

    7 Ways to be Efficient With Your Facebook Ads

    Now that you know your goals, target market, and understand the bigger picture of running a Facebook ad campaign, you want to ensure your campaigns run efficiently. Here's how.

    1) Build your audience. Using Facebook to generate fans (known as "connections" in Facebook ad lingo) is an opportunity to build the exact audience that you want to expose your ad messaging to. You should always be working to do this by pushing out thought leadership content, running contests, and promoting offers and lead generation campaigns. The more targeted you are with building this audience, the more impactful your broadcasts will be when you message your followers. For instance, start by targeting a select group like we've done in the screenshot below:

    FB   A

    2) Attract more of those same types of users. The easiest way to do this is using Sponsored Stories. At HubSpot, we've been able to use Sponsored Stories to help attract additional connections that behave similarly to others in our target market.

    facebook ad targeting

    Driving the right kinds of fans to your business page will help ensure higher response rates as you push your message out through Facebook ads.

    3) Take advantage of the fans you've generated. Talk to your fan base regularly via your business page by posting content that drives engagement. And by engagement, I mean lead generation. Here at HubSpot, we take the thought leadership approach, meaning that we think people will want to use HubSpot software if we are able to prove that we truly understand the digital landscape and have the best online marketing software. Take a look at some of the ways we do that.

    First, we like to share relevant blog posts that help educate our readers. You might think blog content doesn't generate leads, but that's only true if you've forgotten to include calls-to-action within your blog content. And we'd never do such a thing ... would you? ;-)

    facebook lead generation

    But we also post lead generation content directly to our Facebook page. This post directs fans to a landing page on which they can redeem an ebook about creating effective calls-to-action.

    facebook lead gen

    4) Converse with your fans. What does talking with fans have to do with paid ads on Facebook? Well, it's an important factor in the success of your overall Facebook strategy. You can't just think about paid ads in a silo -- you have to think about the entire strategy. Conversing with fans will give you a better idea of who your target audience is, what they think about, and what they need. And that makes for better ad targeting.

    5) Run paid ads to target segments. Don't be afraid to engage in direct response lead generation on Facebook. HubSpot uses ads like the one you see below to send users to landing pages that offer free inbound marketing assessments, free software trials, and inbound marketing software demos. Do they work? We wouldn't be running them if they didn't.

    targeting facebook ads

    6) Segment as much as possible with your campaigns. Messaging and landing pages should be tailored to specific demographics. For instance, if GM were running a campaign for the Chevy Volt, you can imagine how messaging would change among those aged 25-34, as opposed to those aged 55-64.

    The younger audience may be more concerned with the fact that the Volt is helping our planet become more green, while an older audience near retirement age may be more interested in buying a car with better fuel economy. Think of every possible way you can segment, and use your Facebook ads, messaging, and landing pages to connect with that segment accordingly. 

    7) Put senior members of your marketing team in charge of your Facebook ad campaign. If the team member heading up Facebook advertising doesn't know who Ogilvy is, then get someone else. The marketing game hasn't changed, just the venues. Using the core concepts of traditional marketing, targeting, and messaging is the way to win with Facebook ads. Having that leadership backbone to coincide with the nuances of social and digital media will ensure a fully optimized campaign.

    Who's to Blame for GM's Facebook Ad Failure?

    So ... was GM doing all of those things? Well, you can see that campaign setup and targeting isn't really that hard -- it's the post-click experience that matters most. If GM was focused on all of these elements and still failed, then perhaps Facebook wasn't the best fit for their particular brand. This doesn't mean that Facebook isn't the right avenue for the auto industry in general -- or any other industry -- since GM has a very specific target audience that differs from, say, KIA or VW. For digital advertisers, the answer to whether or not Facebook advertising is the right choice certainly depends on the market and brand, but most of all, it hinges on proper execution.

    Facebook doesn’t want to fail. They have no interest in going broke. They’ll likely continue to hire top notch developers and engineers, and keep bringing on the best product management and marketing professionals to work on continuously improving their advertising options. Rand Fishkin wrote an article back in 2010 about all the things he wished he’d known before starting his company. A piece of the article illuminated exactly what we’re seeing in the general public right now regarding Facebook's IPO and their advertising solution -- haters gonna hate.

    I don’t dispute that Facebook has not worked for a considerable amount of advertisers, but it’s also worked quite well in many instances. So before you jump on the lambasting train of Facebook ads, approach the situation using data and an evaluation of your own strategy on Facebook, not just opinions. Ask yourself, did I truly understand how to advertise on Facebook, and did I do all of the things that I should have in order to fully execute on my strategy? Or was I just looking for a quick and easy way to generate conversions? The barriers to entry are practically non-existent when it comes to Facebook ads, but that doesn't mean they're easy in terms of generating ROI. That's what all advertisers must keep in mind when deciding whether or not Facebook ads are appropriate for their business.

    What do you think of Facebook advertising? To what do you attribute GM's Facebook ad failure?

    Image credit: Zeevveez

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