An ad:tech panel highlighted the benefits of participation, relevance and scale through social media.

As it becomes more and more expensive to generate compelling content online, social networking sites are thriving by leveraging free content created by users. They have quickly gained mass audiences-- MySpace boasts millions of loyal users and strong relationships; almost overnight Facebook became the number one photo sharing site on the internet and YouTube is now exponentially more popular than MTV.

Advertising is following the crowds. Spending on user-generated online media -- blogs, vlogs, podcasts -- surpassed $20 million last year, a 198.4 percent increase over the 2004 level, according to a PQ Media study. Some of the key growth drivers are continued audience fragmentation, the perceived ineffectiveness of traditional advertising and the desire to reach the elusive 18- to 34-year-old demographic. Spending in this arena throughout 2006 is sure to skyrocket.
 
Involving consumers is an attractive technique for marketers to obtain real engagement, a result that is not easily achieved in this age of simultaneous multimedia consumption.

On the panel, "Social Media: The Emerging Set of Communications Platforms," a group of innovators who favor next generation web content discussed opportunities within this segment.

Moderator Dave Evans, co-founder of Digital Voodoo, defined social media as the set of sites that provide experiences that aren't interrupted, and that rely on user messages and content.

Why does advertising through social communities represent Web 2.0 advertising? The brand experience is more relevant to the conversation. Participation enables users to feel they have a role in the messaging. And it's scalable-- the scalability of a campaign's persuasiveness increases as users play a role.

"Consumers share everything online everyday," said Garrick Schmitt, vice president of user experience at Avenue A | Razorfish. "We are only in the early stages of figuring out how to fully leverage social networks, so we need to know who is sharing what and how often."

Marketers are beginning to tap into these experiences through new forms of relevance and tags (ways for users to classify information). Schmitt told the audience to make sure marketing messages are share-able, tag-able and track-able.

A major challenge for brands attempting to participate on popular social sites is executing without disturbing the highly engaging consumer experience.

Dave Ellett, chairman and CEO of Powered, Inc., pointed to a solution-- providing messages in the consideration phase. He noted that one strategy is to create educational products on topics consumers care about.

"If the educational content is product agnostic, consumers will respect the experience. In a recent study, 29 percent of respondents were more likely to buy after absorbing contextually relevant messaging than what resulted from media advertising," said Ellett.

One example of attracting targeted consumers with free education is Sony's campaign that taught consumers how to convert VHS to DVD. At the point in which consumers reached the end of the learning process, Sony inserted its relevant product assortment and provided links to its website. Hence, Sony reached consumers in the consideration phase, and the messaging was contextually relevant.

Sony's project was a success for two reasons: consumers gained valuable information without feeling that the course was slighted towards Sony's products and Sony reached consumers in the consideration phase.

Since social media is consumer generated, marketers worry about negative press. In April, General Motors experienced backlash when it used a technique called video mash-up to let consumers insert their own copy and create customized 30-second commercials for the 2007 Chevrolet Tahoe. A number of ads were created that attacked the SUV on a political and environmental front.

How can brands control risk?

"If your website enables customer feedback, it's fair to establish a set of guidelines (i.e., no profanity)," said Anu Shukla, CEO of Rubiconsoft, Inc. "You have to let disgruntled people express their voice, but you can also respond. Editing or hiding customers' negative comments only defeats the purpose of social media."

Retailers like Petco and CompUSA are analyzing customer feedback on online community sites in order to use that information to improve the customer experience, as well as to discover missed opportunities. Paul Rogers, vice president of engineering at Bazaarvoice, described how his client Petco tracked a "Top-rated Products" subsection to learn what consumers were talking about most. Traffic driven through searches on Bazaarvoice's site had a higher conversion rate than those who performed searches on the large portals like AOL and Yahoo!.

Rogers added, "The time is right for credible content. You can pull new customers in by pushing feedback out."

It's evident that using word-of-mouth, customer feedback, educational marketing and various forms of consumer-generated media can result in massive impact, especially as the collective conscience grows more powerful everyday. 

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