Some Automakers Questioning Effectiveness of Facebook Marketing

Although most automakers have embraced Facebook as an integral part of their advertising and marketing mix, most social media experts agree that the social networking platform’s real value is as a means of driving conversations, not sales.

Still, some automakers have had notable success using Facebook.  Twelve thousand of Audi ‘s Facebook fans signed a petition promising to pay $50,000 if the automaker would bring it’s TT RS coupe model to the U.S. Prior to the Facebook campaign, the model was available only in Europe.

Rick Case Honda in Davie, Florida sold 100 new cars during the first week in June as the result of an “employee pricing” Facebook ad.

Other automakers, however, are still on the fence. Fiat North America’s Head of Brand Communications Casey Hurbis said, “We’re asking what our efforts are worth in ROI.”

In February, Fiat offered its Facebook fans $500 incentives on the Fiat 500 subcompact and a chance to win one of 12 models the automaker will be giving away next month when the campaign ends.

Hurbis said the campaign is “an opportunity to gauge the return on investment in the social media space.” So far, he said he knows it has driven some traffic to Fait dealers.

Facebook’s relatively low cost makes it an attractive medium for marketers but last month General Motors Company pulled $10 million worth of Facebook paid ads and sponsored content, which provides better visibility in user’s New Feeds.

Instead, GM plans to shift that $10 million, and possibly considerably more, toward creating free content. The automaker already spends $30 million annually on free content creation, which it says tends to be more effective at delivering results.

In an email, a GM spokesman said, “We will continue to have a huge content presence on Facebook. We expect to significantly increase our spending on Facebook content. We’ve had great success engaging customers and fans on our product and brand pages.”

GM spends $1.8 billion on advertising in the U.S. annually.

American Honda, however, has had great success with sponsored content on Facebook. The automaker attributes its Facebook campaigns with helping it achieve record sales over the past five months.

American Honda’s Senior Manager of Digital Media John Watts said of the automaker’s sponsored content activities, “We’re happy with what we’re getting.” He added that American Honda’s Facebook budget is “modest” compared to General Motors’.

Facebook’s Manager of Global Marketing Solutions Doug Simpson advises automakers to think of the social network as a tool for building their brands through word-of-mouth recommendations, and not to expect overnight increases in their sales.

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