Facebook is going the extra mile to woo stakeholders in the auto industry by holding “summits" in Detroit and Los Angeles, attended by executives from Team Detroit, Carat, GM, Ford and Toyota. It has its own reasons to do so, when it faced a hurdle last year. In 2012, just days before holding its own IPO, General Motors Co. announced it would pull its ads from Facebook since it was unsure if they were having an impact on sales.
GM eventually resumed advertising on Facebook in April 2013, and the social media site has since been trying to be more strategic about the proposals it offers to carmakers. Facebook has a tantalizing pitch for carmakers – that aside from its reach, the social media site can deliver an audience of people actually in the market to buy a vehicle. Facebook, via its data partners, can show carmakers how many people exposed to their ads actually decided to buy a car after at least two months since exposure to the ads.
This means that Facebook has to show carmakers its vital role in influencing target buyers to make a purchase. Showing that data would allow Facebook to convince carmakers to spend a larger of amount of money on its site; after all, carmakers could also use other online options to reach consumers actively researching a car purchase.
Facebook's strategy largely depends on better targeting. In April 2013, Facebook managed to make it possible to target people in the market for a vehicle through its partnership with Datalogix, which in turn has a relationship with Polk, a marketing company that gathers registration data from DMVs. According to Addie Conner, chief innovation officer for social-ads company SocialCode, Facebook is now reaping the good effects of better targeting, combined with better measurement and the option of more-attractive newsfeed ads.