30 Nov 09 Sponsored Conversations: Product Placement in Social Media

Bloggers have been participating for years and now as other media like Facebook Fan Pages and Twitter profiles become more popular, the commercialization of these audiences is on the increase.

Niche websites have evolved that provide a platform for trade of your social media audiences and of course there’s no shortage of listings on Ebay. It’s a new gold rush of sorts. Not of the scale of the .com trade, but who knows what the future holds.

@BreakingNews

Audience: 1,443,582

The recent deal between @BreakingNews and MSNBC is the latest high profile case. MSNBC drives more traffic to their site, which generates additional advertising revenue.

This deal follows the @cnnbrk deal earlier this year (2009.) At the time of the sale, @cnnbrk was the most populous Twitter account, with 945,152 followers. Today it boasts 2,811,594.

There’s a clear difference between the two examples above. One was for a proprietary name, which people assumed was CNN anyway. The other is a generic breaking news site, with no prior brand association.

So is it ethical? Is this the first part of a community hijacking?

This is the way things are starting to move and really, its no different to newspaper takeovers in days of yore. A community will no longer be a community for the sake of it. Bills need to be paid. commercialization is almost inevitable.

A possible approach to sponsored conversations.

There’s always going to be some compromise, but let’s remember that we can’t please everyone all the time. Paid product placements on social media need to adhere to the principles of authenticity and transparency that are inherent to social media:

Clearly identify all sponsored content.
The community administrator has final editorial approval of anything that is published and has the right to veto anything she deems to be compromising.

To illustrate one approach to product placement in social media, I’m going to use the fictious Facebook Fan Page:

Beer

Beer has 653,279 fans. The sizable audience will probably be of interest to the beer brands, especially considering the audiences growth potential. So how can the beer brand get their message to the community in a transparent, non-sinister and authentic manner that doesn’t bring them or the Fan Page in to disrepute?

1. Sell-out to the highest bidding beer brand.

This entails re-branded the page, changing the avatar, links and content on the page.

Remember that you built the community on the idea of love of beer…any beer. What if you select a beer that none of your audience likes? Then what? People leave, people complain, people stop paying attention. One must be weary of hijacking the community.

The problem is, we don’t actually know if the community likes this particular beer in the first place. The rebranded fan page with could turn the audience away.

2. Run a poll and ask the community to share their preferred Brand of Beer.

Get people to vote on their favourite beer, then approach the local distributor with hard data, and leverage it for a sponsorship deal. You know that the majority of your audience likes this beer, so now the risk to the community is mitigated. You’ve asked the community what they prefer and now your going to give it to them, rather than imposing upon them.

The community has voted. Asahi is preferred by 64% of the audience. Now you can approach that brand with hard facts:

Hello Asahi beer, you page has 2431 fans on your Facebook Page. My beer page has 40,000 fans and 64% of then like Asahi beer. This will save you tens of thousands of dollars on expensive, but unproductive social media campaigns. My audience loves your beer. And they can be your audience. Interested in sponsoring / buying my beer fan page?

Why should they build a new community from scratch, when they can use yours instead? They don’t know how. It will cost them time and a lot of money. You’ve put a better deal on the table.

A captive audience is of value (Eg @BreakingNews)

It started with blogs and now we have Twitter profiles, Facebook Fan pages, and to a lesser extent, Linkedin Groups that zoom in on niche audiences. It takes a group administrator with a lot of will-power to turn down the advances of advertisers wanting to talk to your audience, be it to promote an event, product or service.

For those who do take up these Sponsored Conversation opportunities, the execution has to be impeccable. It’s a delicate balance to promote sponsored material in an ethical and sustainable manner to help ensure there is no backlash from the very people that helped create your community.

The ROI Question

Consumer generated media is attributed higher trust and therefore, arguably delivers a higher ROI. According to Forrester, Social Networking site profiles from a company or brand are trusted by only 18% of audiences. Surprisingly, Social Network profiles of people you know only received a 43% trust rating. At the time of writing, there was no data on the trust levels associated with a community created Facebook Fan Page or Twitter profile.

While the debate continues into 2010 , I’ll be publishing a Facebook for Business post tomorrow. Follow me for the update.