GM talking with Facebook about advertising again: sources

Tue Jul 3, 2012 4:47pm EDT
 
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By Ben Klayman and Gerry Shih

DETROIT/SAN FRANCISO (Reuters) - General Motors Co and Facebook Inc are discussing the return of the U.S. automaker as a paid advertiser almost two months after GM said it would stop running ads on the social networking website, sources close to the situation said on Tuesday.

Although the two companies remain far from reaching an agreement, Facebook executives have assiduously courted the world's largest carmaker. One source said Facebook was not pushing for GM's immediate return, but offered to provide data showing the effectiveness of the website's paid ads.

Facebook Chief Operating Officer Sheryl Sandberg sent GM Chief Executive Dan Akerson an e-mail urging the company to reconsider its decision shortly after the third-largest U.S. advertiser pulled its ads in May, a move that undermined confidence in Facebook on the eve of its highly-anticipated initial public offering, according to sources who were not permitted to speak publicly because the talks are ongoing.

At a global advertising conference in Cannes, France, last month, Facebook global sales head Carolyn Everson sought out GM's global marketing chief Joel Ewanick to continue face-to-face talks, leaving open the option of GM returning to the fold, sources said. Facebook offered the same information it provides to all of its big advertisers, but did not offer any concessions.

GM and Facebook declined comment. The news was earlier reported by the Wall Street Journal.

Three days before Facebook's May 18 IPO GM said it was dropping paid ads on the website because they had little impact on consumers.

The decision by the carmaker, which spent $10 million on Facebook in 2011, was the first highly visible crack in Facebook's strategy and underscored doubts about whether advertising on Facebook works better than traditional media.

GM emphasized at the time that it would retain its Facebook pages, for which it paid no fees, to market its cars and trucks.   Continued...

 
A giant "like" icon made popular by Facebook is seen at the company's new headquarters in Menlo Park, California January 11, 2012. REUTERS/Robert Galbraith