Facebook Goes 1984 on Shareholders
Facebook (NASDAQ:FB) is being initiated into the public company life — and it’s an uphill battle. The stock has been annihilated since its IPO at $38. Anchor advertiser General Motors (NYSE:GM) publicly stated the ROI on Facebook ads sucked. A study was released showing brands get more value from free communications on Facebook versus paid advertisements. What’s a public company to do in order to save the stock from more gutting? Hire a PR firm to create an Orwellian environment!
Don’t Miss: Facebook PROVES Its Ads Actually Work.
Last night on Bloomberg TV I watched a marketing “expert” come out and defend Facebook ads. Really? In the face of all this new data? This is what you call paid PR. I don’t know for sure whether Facebook’s PR firm promoted and planted this exact Bloomberg guest, but if Facebook is openly starting a PR and marketing campaign to defend the efficacy of their ads, this would be one of the primary tactics.
This legal lying sucks, but it’s veiled under free speech in various forms. For example, McDonald’s (NYSE:MCD) and Coke (NYSE:KO) — some of the least healthy food and beverage makers on Earth — sponsor the Olympics and place their brands next to elite professional athletes to create the perception top athletes consumer their products. Chuck E. Cheese’s is one of the most ubiquitous advertisers on PBS Kids — a network promoting healthy eating for children. Heavy air and water polluters such as DuPont (NYSE:DD) sponsor some of the largest “green” events every year. The list goes on and on.
Now, Facebook has been forced to play the same game. Moreover, the company needs to use a subset of resources to manage investor and prospective investor perceptions before the stock continues to slip into the void. How effective are Facebook ads? It’ll soon be too confusing to tell.