Shortly before Facebook’s turbulent IP “uh oh”, GM announced that it was pulling its $10 million advertising budget from Facebook. Controversy erupted. Accusations ensued. Camps divided into three factions, those who support GM, those who support Facebook and those not yet ready to take a stance either way, but are paying attention.

It will forever be known as “the meeting” between Facebook sales executives and General Motors Global CMO Joel Ewanick and other GM senior marketing executives. In the end, Facebook and GM each walked away with less than they had walking into the meeting. Facebook lost a premier advertiser and also lost Ewanick as an advisor to its invitation-only client council. GM lost the ability to demonstrate leadership in a time where the advertising and automotive industries are flailing. All is not lost however as GM will continue to spend $30 million annually in managing its Facebook presence through earned and shared media strategies.

So what happened in that now infamous meeting? Perhaps one day, its premise will inspire an episode of AMC’s Mad Men…

It’s a dark, dimly lit room illuminated only by a projector. Cigarette smoke fills the only visible light. On the wall is an image of Facebook’s timeline. Don Draper leans forward. His words cut through the smoke. In a calm voice with menacing undertones, Draper asserts his one and only reason for staying in that room, “my client has requested a home page takeover. Now, before you respond, allow me to be clear. This, what it is you’re selling, your advertising products, they don’t work for us. We have deep pockets and we’re willing to invest in the right partner that shares our vision. Now, how about you play nice like all of the other media partners and give us what we want.”

Facebook responds, “no thank you.” The sales team then shuts their iPad and MacBook Air lids and proceeds to leave the room in what almost seems like a well-rehearsed exit. They must do this often. Draper sits back in his chair and exerts a simple, but telling response, “huh…”

While many speculated what actually took place in the meeting, Advertising Age’s Cotton Delo reported that the scenario above is probably not far from the truth. GM is interested in Facebook’s audience, but believes that the ad formats currently available are unattractive and ineffective. The automaker’s team desired bigger, higher-impact ad units. After all, GM and many other brands around the world have learned the art and science of advertising by investing in campaigns that stand out from others, literally and figuratively.

So why is Facebook steadfast in its position to not cash in? The answer is user experience. Facebook is home to over 900 million engaged users. U.S. users alone spend 441 and 391 minutes per month on average interacting on Facebook’s desktop and mobile platforms respectively. Mark Zuckerberg and the storied “build and ship” culture he’s created is passionately dedicated to improving and not compromising the user experience. For the time being, anything that disrupts that experience is off the negotiation table even it means the company must walk away from $10 million deals. As a publicly traded company however, it must now also improve investor experiences.

At some point, brands will need to see additional options for paid media. By design, advertisements should be engaging rather than distractions. But a large part of the problem has nothing to do with form, but instead function. Advertisers are still deploying uninspired digital ads on other platforms. Many bring that methodology to social media. Accordingly, the metrics traditional marketers use to measure success in social networks are limited to impressions, reach, clicks, and engagement.

“A bad ending follows a bad beginning.” – Euripides

Advertisers need to think about new end-to-end experiences that inspire and engage a far more connected and discerning audience. Home page takeovers are for Myspace and the digital nomads who roam elsewhere on the web. Facebook is a new type of co-created canvas that requires different strokes to attract a savvy clientele.

Even though GM remains committed to Facebook through earned, owned, and shared programs, it appears to carry a traditional philosophy and approach to its everyday community strategy. General Motors currently is home to 383,000 Likes. Chevrolet boasts just over 1.2 million. Changing lanes for a moment, its competitor Ford has more than 10 million fans globally with 4 million supporting Mustang, the single largest vehicle fan page on Facebook.

I reached out to Scott Monty who leads Ford’s Global Digital Communications for his thoughts on GM’s move. Ford sees Facebook as a new vehicle for storytelling where paid, earned, owned, shared, and promoted media converge to create a new story board that begets new rules. According to Monty, “Ford is accelerating our efforts in Facebook and other social platforms. It’s all down to execution. We’ve found Facebook ads to be very effective when strategically combined with engagement, great content and innovative ways of storytelling, rather than treating them as a straight media buy.”

One of Ford’s much touted successes on Facebook was its introduction of the 2011 Ford Explorer via its “Reveal” campaign. The company claims that the combination of advertising and creative storytelling helped it outperform a traditional Super Bowl advertisement for a fraction of the cost.

Monty emphasized support of Facebook, “We continue to have a strong, collaborative relationship with Facebook, which includes first-of-a-kind vehicle reveals, advertising and innovative ways of sharing content. Our engineers have also been working with Facebook engineers to develop unique and safer ways of integrating the car experience with Facebook.”

Ford’s Facebook strategy is also an extension of a more empathetic marketing and sales campaign that’s underway worldwide. I had the chance to interview Jim Farley, Ford’s first CMO during Blogworld Expo in Los Angeles. His mission as instructed by Ford President Alan Mulally was to, “get people to fall in love with the blue oval all over again.”

When brands approach marketing and advertising opportunities with a purpose, the results that follow are commensurate with an investment of both intention and execution. In other words, you get out of it what you put into it. And according to a report due this week, comScore has found that Facebook ads are effective. In a report by CNBC’s Julia Boorstin, she explained that comScore thinks Facebook ads are having a “statistically significant positive lift on people’s purchasing of a brand.”

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For years, advertising has made a business by thinking outside of the box. But when it comes to flat, consumerized networks such as Facebook, perhaps the industry needs to think outside of the box once again. Facebook is not without fault however. It too must help advertisers create and measure successful campaigns while enticing the community of active users to support the brands they love. Over the last few weeks alone, Facebook introduced new APIs to help advertisers design “clicks to action” within its marketing efforts to trigger what could be unconventional, but possibly more meaningful outcomes. It challenges marketers to think beyond the Like or traditional impressions for that matter.

In what seemed to be a direct response to GM’s adieu, Facebook also introduced a clever new tool that shows marketers just what they’re missing. Now within the timeline, marketers can see reach data for each post. Information includes the number of total fans who may have seen the post and the amount people who were reached through paid promotion.

Facebook is teaching marketers that it’s not just about whom you reach, the opportunity also lies among those you do not reach today.

The court of public opinion may be weighing in on the matter of Facebook vs. GM. But I think the real case is against the people in social networks vs. traditional marketing methodologies. What’s clear is that Facebook is intent on serving users first. Perhaps advertisers could take a cue from Zuckerberg to rethink experiences through advertising and marketing campaigns that consumers can’t help but click, share, and engage.

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The End of Business as Usual is officially here…

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