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While it will still maintain a presence on Facebook, General Motors has decided to stop its advertising there. Although GM’s $10 million annual advertising budget for Facebook is a drop in the bucket for the auto maker, which spends $3 billion worldwide on advertising each year, this move raises a big question about Facebook’s business model. Will other firm follow the GM
Enthusiasm and a buying frenzy aside — How is Facebook, a firm that generated $3.7 billion in advertising during 2011, worth $100 billion via its IPO?
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Despite GM’s move, Facebook today announced that it is increasing the amount of stock that will be sold during the IPO — due to high demand.
Let’s see what is ahead. It should be interesting.