NEW YORK (AdAge.com) -- Is there a difference between paying Kim Kardashian to tweet about Armani purses and compensating Tiger Woods to star in Buick commercials? Is it really word-of-mouth if you have to pay for it?
Maybe it doesn't matter.
As marketers rush to develop relationships with key influencers and consumers, a bevy of entrepreneurs are carving out businesses helping brands do in the social space what they've long done in other areas: spend money to generate impressions.
And that's led to social-media squabbling over whether sponsored tweets and paid-for blog posts are the scourge of the internet, as they're often painted, or merely newer applications of old, ad-supported media models in the new-media space.
But lost in that debate is the fact that paid media -- which sponsored tweets and blog posts most certainly are -- and organic word of mouth go together like chocolate and peanut butter.
Have it both ways
In fact, together paid and earned media are more powerful than either alone, suggests word-of-mouth researcher and consultancy Keller Fay Group. According to its data, having experience with a brand or product is the most important ingredient in the effectiveness of word-of-mouth, increasing propensity to try a product by almost 20 points. Throw in marketing as well and that likelihood jumps another nine points, or almost 20%.
"Personal customer experience with a brand, in one form or another, is the central operating principle that's critical for effective word-of-mouth," said Ed Keller, CEO. "But beyond personal experience, advertising or point-of-sale references also have a big role to play in word- of-mouth -- roughly half of all conversations include some type of reference to media or marketing."
Keller Fay's research doesn't look specifically at sponsored tweets or posts but at the entire paid-media sphere -- TV, radio, magazines, etc. -- and Mr. Keller has started advising clients to think about ways to not only provide a great product and service that leads to organic word-of-mouth but to "think about the full range of your marketing arsenal as giving people a language and motivation to talk" about your brand.
But increasingly, paying people to spread digital word-of-mouth through social networks seems to generate almost negative reactions. It's the money changing hands that sours Dave Balter, CEO of BzzAgent, on the idea. BzzAgent works with brands to distribute products to bloggers in hopes that they'll review or write about it. But paying people leads to biased endorsements and reviews, he said, which compromises the integrity of the channel. "Many people are paid to do a job they don't like to do every day, but they still put a smile on their face and do it because they're being paid," he pointed out.
But from a traditional advertising point of view, there arguably doesn't appear to be a lot of difference between buying a celebrity's endorsement and paying them to tweet about a brand, like Izea paid Kim Kardashian to tweet about Armani purses.
Difference of opinion
John Moore, exec VP-director of ideas and innovation at Mullen, talked about a recent meeting he had with Izea, which pays people to tweet and blog about products and services: "I went in completely skeptical, wanting to dislike what they have to say. People have such a strong visceral distaste for anything that's paid for." But by the time the meeting had ended, he was likening the concept to Tiger Woods endorsing Buick.
He suggests the difference of opinion on such sponsored social media could be chalked up to the clash of backgrounds between advertising and PR.
"Many of the social-influence groups coming out of agencies are from PR backgrounds and PR at its essence is about getting The New York Times to write an article on how good my camera is or how good my car is, and they see social media as the same ... nonpaid," said Mr. Moore. Advertising theory, on the other hand, says it's OK to pay people to endorse a product. "I'm not the purist in social media that they are -- and that doesn't mean I'm right and they're wrong or vice versa," he said.
Sean Corcoran, a Forrester Research analyst who is compiling a report on the value of paid, earned and owned media, considers tactics such as sponsored blogging or tweeting a form of paid media whose effectiveness, when done the right way, with disclosure and authenticity, lives somewhere "between your basic display advertising and true earned media."
"You can't buy your way into real organic, earned media and that's important for marketers to understand," he said. "With that said, marketers have a lot of resources at their disposal."
And the fact people are up in arms about these gray areas? That's a good thing, Mr. Corcoran said: "It's the self-regulatory part of the internet, which is cool. People are trying to protect that."