Shifting to social media on the retail front

Jim Farley is all about Facebook, and he wants the retail side of the business to embrace social media, too.

Ford's marketing chief told Reuters last week that the automaker's advertising dollars “have to flow to where the people are.” He said customers nowadays spend as much time on the Internet or using smart phones as they do watching TV.

Under Farley, Ford has leveraged Facebook and Twitter to reach out to those customers. The yearlong lead-up to the launch of the Ford Fiesta subcompact was the automaker's first comprehensive dive into social media marketing in the United States. Ford's Fiesta Movement social media campaign had a retail element that kicked in as the car neared its launch date.

Launches for the redesigned Ford Explorer crossover and Focus small car also have significant social media elements.

Farley and other Ford executives continue to encourage dealers to jump into social media. I spoke with a Ford dealer last week who's taking that advice. The dealership has a YouTube channel and Twitter and Facebook accounts. The dealer is even contemplating shifting all marketing dollars to social media in 2011.

It's a risk. Will the sales follow? But dealers have a big incentive. Social media marketing costs significantly less than traditional advertising. That's a powerful reason to at least experiment.