MGM Defies Skeptics, Says Facebook Ads Paying Off

Vegas hotelier's stance stark opposite to General Motors

For every GM souring on Facebook ads, there seems to be an MGM that's sweet on them. While other brands question the value of Facebook advertising, the hospitality chain told Adweek that it's getting roughly 2.5 times more revenue from the social site so far in 2013 compared to the same period last year.

The Las Vegas-based company has a three-pronged approach—retargeting consumers via Facebook Exchange, pitching discounted Facebook Offers and employing the social giant's custom-audience features. At the same time, the brand is buying page post ads in mobile News Feeds, Sponsored Stories and Facebook Marketplace promos.

"We are not being broad and blanketed about how we are trying to talk to our customers," said Nick Mattera, MGM's social media manager. "We are showing offers that are designed to get them booked, while highlighting the customer experience."

His team crafts the ads so they direct clickthroughs to a hotel's booking landing page rather than a Facebook app or any other item on the social site. That detail underscores how the like-gating tactic—extremely popular with brands two years ago—is clearly fading.

"We don't want to trade a like for a booking," Mattera said. "We want people to like because they actually like us."

Additionally, MGM says that Facebook's "lookalike" ads-targeting feature has yielded four times as much revenue as the ad outlay. Lookalike audiences can be produced when a marketer uploads its customer data, such as email addresses and phone numbers. The system then matches those customers with other Facebook users, creating an audience segment based on shown interests and demographics to serve ads against. So in the end, the advertiser cannot only target past customers on Facebook but also folks who have similar attributes.

MGM shared these other factoids about its Facebook marketing:

– Facebook Exchange has produced a 15X return on investment;

– 3X ROI for Facebook Offer campaigns;

– It picked up 1.5 million new fans during the last half of 2012, while acquiring two of them through organic marketing for every one that came in due to a paid ad.

"The viral nature of social media inherently is one of the biggest opportunities that we have," Scott Voeller, MGM's marketing svp, said of the last stat. "'What happens in Vegas, stays in Vegas' was clearly a slogan invented before Facebook. People want to share, and Facebook is a natural way for them to do so."

@Chris_Heine Christopher Heine is a New York-based editor and writer.