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

NEW YORK (TheStreet) -- When my wife returns home from work in the afternoon and asks how my day was, I like to turn on my biggest, most booming radio voice and say: All Facebook, All the Time!

I've always been impressed by the power of Facebook ( FB). And I am as bullish as humanly possible on companies that will lead the mobile revolution. So it makes sense that I am a small part of the Facebook media frenzy.

Plus, somebody has to step up to defend the company against the unprecedented level of unwarranted hate the media now, suddenly, sends its way.

General Motors Is the One With Problems

When news broke that General Motors ( GM) dropped $10 million worth of advertising from Facebook, the media could not contain itself. Bubbly news babes, serious news dudes, cable talk show pundits, financial media gurus and equally lost marketing slugs rambled on -- sans much, if any, critical thought -- about how the development should raise red flags about the social network's ability to grow and maintain advertising revenue.

If the nation's third largest advertiser thinks Facebook is ineffective, Mark Zuckerberg is screwed, they gushed.

If it were not for Twitter, another great company scribes and talking heads will likely love to hate when it goes public, I might not have come across what should have been Breaking News on CNN, courtesy of AdAge:
Rather than run sponsored stories, which look like Facebook posts, or smaller units on the right side of the pages, GM asked if it could take over a page. It was told no.
The rebuff says a lot not just about why GM yanked ads from Facebook, but also underscores the continuing tension between Facebook and some of the country's deepest-pocketed marketers
.

Kudos to AdAge for even running the story. Even though it should have, it barely made headlines anywhere else. Instead, the media continues to malign Facebook, framing GM's decision to sponsor Manchester United as an even bigger kiss-off to the newly public company.

Thankfully, Cotton Delo can think for herself. She wrote:
Facebook has shown remarkable restraint in what it will sell marketers over the years ... It has always put the user experience first, and that's helped drive the social network to 901 million global users. But that has also meant turning down advertisers.

Part of the beauty of Facebook is the control it exercises over the user experience. There's a reason why Tim Cook says Facebook is the company closest to being like Apple ( AAPL). Tim knows a guy who would stop at nothing to support his product. Now, he knows two (and maybe three). Figure out that riddle.

In any event, advertisers who do not understand the utility and power of that idea will have lots in common with General Motors. Like GM, they'll claim ineffectiveness. They'll blame the perceived lack of results on Facebook. And they'll point to the way they've always done things. They don't get it. And the current old guard regimes at those types of companies probably never will.

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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