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Facebook Actually Dissed GM: Where's the Media Coverage?

Stocks in this article: FB GM F AAPL

Contrast GM with Ford (F), a company that understands how to leverage Facebook advertising.

Ford realizes that buying space on a social network like Facebook generally does not generate a slew of direct causal relationships. Suzy sees an ad. Suzy rushes to her local Ford dealer. Suzy buys a car. In fact, most advertising does not work like that, particularly on big ticket items. It's about building the brand. Planting the seed. And nurturing that process to completion several times over a considerable time horizon.

As GM runs away from Facebook, Ford ups the ante. The company plans to sell licensed merchandise, such as T-shirts and toy cars, via Facebook. That brings in revenue, but, more importantly, builds the brand. It forges a connection with current and prospective customers.

Facebook cannot operate as little more than a conduit for advertising. That's like a talk radio station only allowing its hosts to discuss non-controversial topics that make each and every client comfortable. When a client calls and says I don't like what Howard Stern said today, you don't put a muzzle on Stern; instead you do your freaking job and explain to the client why they decided to advertise on Stern's show in the first place. You politely school them as to how and why Howard gets results.

While that's not a perfectly parallel analogy, it drives home the overarching point: You cannot let the client run the company or control the content/experience. You create an excellent product for your audience. Then, and only then, can you deliver results for advertisers.

The smart ones -- like Ford -- understand this. They recognize that if they do not step aside and let Facebook build its brand like it knows how, there's no way any flavor of advertising will generate success via the site.

This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

At the time of publication, the author was long FB.
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