Ford to Expand on Facebook With Ads for Logo Merchandise
The ads, a first for the automaker’s licensing operations, will appear on the right side of the wall of users of Facebook Inc. (FB)’s social network who have visited Ford and motor-sport pages, said Betsy McKelvey, Ford’s marketing manager for licensing. The ads will promote 20 items in a rotation through June 10 in advance of Father’s Day on June 17, she said.
Ford, the second-largest U.S. automaker, is remaining active on Facebook after larger rival General Motors Co. (GM) decided this month to pull its ads from the social network. Licensed items help build Ford’s brands and generated $1.5 billion in revenue last year, most of which went to companies such as toymakers, video-game producers and clothing manufacturers, according to John Nens, the automaker’s licensing manager.
“When we didn’t take the government money, the Ford oval became more popular with consumers,” Nens told reporters today in Dearborn, Michigan, where the automaker is based. Last year’s revenue, from more than 45 million licensed items sold, was an increase of 50 percent from 2005, he said.
Nens declined to say how much of the revenue Ford receives.
Ford’s credit was raised to investment grade in the past two months by Fitch Ratings and Moody’s Investors Service, letting the automaker reclaim control of the logo and other assets put up as collateral for $23.4 billion in loans in late 2006. The financing enabled Ford to avoid the bailouts and bankruptcies that befell the predecessors of GM and Chrysler Group LLC in 2009.
Ford is seeing an increase in licensing requests for such new items as Mustang men’s cologne, a floral bouquet in the bed of a toy 1948 Ford truck and a $34 T-shirt sold at Saks Fifth Avenue stores that features a vintage ad for a 1968 Shelby Cobra Mustang, Nens said.
The company also is turning down requests, such as ones to place the blue oval logo on caskets and guns, he said.
“You don’t want to overexpose yourself,” Nens said. “We’ve been offered to get into wine and Mustang beer and we just stay away from those categories.”
The move to advertise on Facebook follows successful placement of posts on Ford’s 67 pages on the social network promoting licensed merchandise, such as the Teleflora LLC bouquet in the Ford truck, McKelvey said.
“The Facebook crowd was saying, ‘Why not do a convertible Mustang?”’ Nens said. “We’ve been telling Teleflora that for two years, but now it makes more sense to them that the social- media folks are saying that would be a good idea.”
GM today cited its consumer research showing that ads on the social network are distracting to users.
Advertising on Facebook is “like you’re having a night out with your family and somebody comes up to you and says, ‘Hey, excuse me, I’ve got this car out here I want you to buy,”’ GM Chief Marketing Officer Joel Ewanick told reporters at the automaker’s Detroit headquarters. “Your first reaction is, ‘What are you doing here? I’m having a conversation.”’
GM said on May 15 that it would no longer advertise on Facebook.
On the same day, Ford reiterated its commitment to Facebook, and Jim Farley, Ford’s global marketing chief, has joined the social network’s client council that advises on ad strategy, according to Advertising Age magazine.
Ford’s Mustang page on Facebook has more than 4 million fans, McKelvey said.
“We’re reaching more people than actually own the vehicle,” she said.
To contact the reporter on this story: Keith Naughton in Dearborn, Michigan at email@example.com
To contact the editor responsible for this story: Jamie Butters at firstname.lastname@example.org
Bloomberg moderates all comments. Comments that are abusive or off-topic will not be posted to the site. Excessively long comments may be moderated as well. Bloomberg cannot facilitate requests to remove comments or explain individual moderation decisions.