With Facebook’s IPO imminent, the social network is facing more scrutiny of its business than ever. Two stories today cast doubt on one of the most important parts of the business: advertising. First, a survey conducted by CNBC and Associated Press found 57% of Facebook users saying they never click on ads or sponsored content on the site, with another 26% saying they hardly ever do. That said, Facebook made 82% of its $1.06bn of Q1 revenues from advertising, so it’s still making money. For now, anyway: General Motors has announced plans to stop advertising on Facebook, having spent $10m on the social network in 2011. Instead, GM will focus on its Facebook Page, rather than paying for ads. “GM marketing boss Joel Ewanick tells the Wall Street Journal that the company “is definitely reassessing our advertising on Facebook, although the [Page] content is effective and important.”
Source: CNBC – http://tinyurl.com/bvmebsy
Source: Wall Street Journal – http://tinyurl.com/czcy6hk
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