Still think that Facebook, Twitter and the rest of the Social Media universe are just for geeks and kids? Think again. None other than The Washington Post ran a feature story yesterday about how marketers and their agencies are using Social Media tools for both word-of-mouth marketing and reputation management. Although the news hook for the story was a local (i.e., D.C.) restaurant joining one of the class action lawsuits against Yelp, the focus of the article was about how major marketers such as Chrysler, Sony and Domino’s are sponsoring tweets and giving samples to bloggers, as well as monitoring the Web for negative comments and reviews.

The Washington Post (via Dion Hinchcliffe)

The article cites Nielsen data that 70% of Internet users trust online recommendations and reviews (we cited the same study here), and quotes a Boston University professor as to why: “[C]onnecting with other consumers is more helpful [than traditional ad messages]. It’s more fun. Consumers love to interact.” The article also reports that digital word-of-mouth marketing is expected to top $3 billion a year by 2013.
The article describes at some length how marketers and agencies are using Social Media tools to influence customer perceptions, including by sponsoring posts and tweets. This is a controversial subject that has been discussed extensively online, including by us. Sponsorship raises issues about the nature of Social Media, including whether media such as Twitter will eventually become less effective if sponsored tweets become more prevalent.

Sponsorship also inevitably raises the issue of disclosure: when and how prominently to disclose, and whether even full disclosure can prevent consumers from losing trust in the communication and, by extension, in the marketer itself. All of the agencies mentioned in the story claim that they fully disclose any sponsorship, either with a hashtag such as “#ad” or some other signifier such as “(sponsored)”.

Interestingly, however, the Post reporter seems openly skeptical about whether the average user understands that these communications are sponsored. A writer for Time voices similar concerns. This is a perspective that we all would do well to keep in mind. Much of the online commentary about sponsored tweets and posts seems to focus on issues other than whether the consumer comprehends the disclosure. If it’s true that casual users might actually be misled (as opposed to merely annoyed) by sponsored tweets and posts, marketers should be extra cautious before launching a Social Media campaign that involves sponsored communications.

The Zavee takeaway:

• It’s official: Social Media Marketing has arrived.
• Users trust online recommendations and reviews. Let’s keep it that way.
• Sponsored tweets and posts raise a lot of issues. If the risk of misleading consumers is one of them, it’s time to think twice about the tactic.