Last week BusinessWeek published an interesting “Viewpoint” about Facebook upending advertising. The author, Jonathan Yarmis, the founder and principal analyst at Yarmis Group, argues that Facebook and other social networking sites can actually help bring something that advertisements lack: credibility. Yarmis focuses on Facebook because of the $200 million investment in the company and how the social networking site might make money with the traditional advertisement model. He argues that it’s not about how these sites will leverage the traditional advertisement model to survive. Instead, it’s about how will advertisers, who have been so reluctant to join the “Web 2.0” world, survive without leveraging the power of these social networking sites? He also notes that in the Internet era it’s getting more difficult to track what kind of ROI a corporation is getting on its ad spending. One interesting stat included in his story:
“Internet click-through rates have fallen precipitously as clutter has replaced clarity. These days an ad has performed exceptionally well if at least 1 in 10 people who see it click on it. Much of the time click-through rates that once approached 3 percent are more like 0.3 percent.”
How can social networking sites help? Most of us who are under the age of 65 likely participate in Facebook, Twitter, LinkedIn, or MySpace. The general thought had been that these sites are used to share our most thought-provoking ideas and favorite photos, or just to stay in touch. In fact, these sites are becoming a trusted online community of friends, family, and colleagues where we can get an honest opinion on topics or products that we care most about.
PR professionals should be embracing these social networking sites for their clients’ PR campaigns. Leveraging social networking sites may prove to be more cost effective than investing in an advertising campaign that may yield little or no return. Many of the more savvy trade and business publications are starting to set up online communities where ideas are discussed and PR professionals can interact with the media in a new way. So, if you aren’t a part of these communities yet, it’s time to check them out. You may be Tweeting away in no time.
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