Ahead of Facebook’s recent IPO, news that General Motors was pulling $10 million in media budget from Facebook ads set off dozens of media stories doubting whether spending ad money on the most giant of social networks is worth doing. Many outlets were certain this would spell doom for Facebook, and possibly for digital advertising in general.
There are several problems with that assumption, and most of them have their roots in the fact that General Motors was, to put it simply, doing it wrong.
First, many corners were cut in explaining General Motors move away from Facebook’s ad platform without any discussion of context. The truth is that GM has been aggressively restructuring its media budget and deployment in total for well over a year. As Jim Edwards at Business Insider points out, “cutting back on Facebook looks less like a rejection and more like part of a process that’s been going on across the board at GM for a while.”
Second, the way GM structured its digital buys on Facebook was totally strange and almost certainly destined for failure. Later in his article, Edwards reveals that GM’s budget split for their Facebook campaign was the widely publicized $10 million in ad buy along with $30 million in creative development. I’ve been doing this stuff for a while, and I’ve never seen a project that lopsided towards creative.
Over the scope of a year or so, creative for an established brand’s ad campaign generally comprises less than half of the total budget. Sometimes this is out of balance towards creative if a significant amount of brand development is required, or if you’re starting from scratch, redefining the brand, or breaking your brand into a new market. But this always balanced out eventually so that media buys take up more (and usually way more) space in the budget.
$30 million on creative means that GM wasn’t seeking a scaled, 1-1 communication with their fans. They weren’t trying to build relationships. They were trying to make toys and widgets and apps that were most likely targeted at simulating authenticity. For far less in salary, they could have hired someone like Scott Monty, who is head of social media at Ford and has done a terrific job championing the brand and making meaningful connections in an industry that’s long been viewed as cloistered and uncaring. That combined with five or six million dollars in development would have given them an incredibly robust app platform, great content, and tons of opportunities for engagement.
Once that infrastructure was in place, GM could have spent $10 million in media buy very well. As it was, they put the cart before the horse, and as such were unlikely to go anywhere. Ford did it right, and they’ve had incredible success with marketing and brand development on Facebook, doubling down on it several times in the last few years.
So what does this mean for you, as an entrepreneur or a small business owner?
1. Spend your money well
Taking the time and making the effort to tell your story will cost you money. You have to spend money on creative. But anyone who tells you that you have to reinvent the wheel (or create a spaceship) in order to have a good digital or social ad presence is wrong. After you get your infrastructure going, you should spend 25-33% of your budget on creative and the rest on actual media buy.
2. Do what makes sense
There’s a news story going around right now that declares that advertising on Facebook is silly, because “44% of Facebook users say they will never ever click on a Facebook ad.” My response to that is this: more than half of American adults are active Facebook users and 1 in every 7 minutes spent online are Facebook activity. 54% of half of America is pretty wonderful advertising audience. If you’re going global, what’s 54% of a billion people? Is that worth your time? Facebook advertising is currently the most effective and efficient way for small businesses and challenge brands to advertise to consumers. Period.
3. Do what makes sense, Part II
Be real and authentic but also be creative in how you put your business out there on Facebook. Do things that make sense for your brand. If you don’t know how to be on brand with content marketing, you have some infrastructure and brand identity work to do. But go ahead and do it and then get back into the game. It will be terrific time spent on your business, and possibly the best time you spend on your business ever.
4. Be bold
You didn’t get into business because you lack confidence. Social media success - and by extension, all advertising and marketing success that leads to building a lasting brand - is about believing in your product and your company. Do that first.