1. GM Unfriends Facebook
Look, we here at the Dumbest Lab have admittedly turned the knife a time or two, so we know full well the significance of a well-timed slur. And that's why GM's (GM) smear of Facebook (FB) prior to its big IPO this week really shouts out to us.
Seriously, we didn't think GM, which not too long ago was as good as roadkill, had it in them.The recently bankrupt -- and still government-backed -- automaker announced on Tuesday its plan to cease advertising on Facebook because it deemed the social network's ads to be less than effective in selling cars. Of course, this is a big deal since GM reportedly spent $1.8 billion per year in ads in 2011, making it the third largest advertiser in the U.S. after AT&T and P&G. "In terms of Facebook specifically, while we currently do not plan to continue with advertising, we remain committed to an aggressive content strategy through all of our products and brands, as it continues to be a very effective tool for engaging with our customers," said GM. Talk about irony. GM is breaking up with Facebook by essentially using the old 'Let's be friends' line! Not to be left out in the Facebook fun, Ford (F) used the occasion to tweak its competitor by tweeting, "It's all about the execution. Our Facebook ads are effective when strategically combined with engaging content & innovation." Snap! Sounds like Ford is using a variation on another tried and true break-up line, 'It's not you Facebook, it's you GM.' Frankly, Facebook won't be losing much on its bottom line even if GM 'unfriends' the company, because it's not like GM was shelling out too much for its services anyway. The car and truck maker spends about $40 million on its Facebook presence, according to the Wall Street Journal, which broke the story, but only about $10 million of that is paid to Facebook for advertising, the rest goes to developing its fan pages. That said, Facebook eventually needs a bigger piece of the automaker's massive ad budget, so the company can't entirely sneeze off GM's slight. And while Mark Zuckerberg could theoretically show GM his market might by purchasing the whole of GM for $35 billion after Friday's $100 plus billion IPO, this certainly would not be the smartest option either. (Although it would be a hoot, wouldn't it? And like we saw from his Instagram purchase, he wouldn't even have to tell his board to do it.) Therefore, Zuck will have to suck it up for the time being, and hope that GM changes its mind sometime down the road. --Written by Gregg Greenberg in New York.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV