Don’t Be Surprised: Coca-Cola Builds Social Media Widget

Last week, Kara Swisher in BoomTown wrote about how the big brands were not yet getting on board with social media.  I wrote then about how I expected big brands to step up and start experimenting, exploring how to use this new media, which is grabbing so many eyeballs, to build and reinforce their brands.

This week, RWW reports on a smart play from Coca Cola, as if in some surprise–they titled it “A Smart Social Media Play From … Coca-Cola?”  There should be no surprise.  Coca-Cola, P&G, McDonalds–name whatever big brand you want–these companies will figure out social media. They all have an imperative to build and extend their brand and image within the minds of customers, and they all understand that where customers are spending time engaging, they need to be.

History is not bad here.  For as long as there has been media of any sort, these brands have been figuring this stuff out.  When TV started, many thought that media was a crazy fad, and no advertisers would figure it out.

So my core view is that big brands will figure out social media and it will become a vibrant channel for brand building, as I discussed in last week’s posting on this.

The thing I’ve been thinking about since though is this… Will the economics of advertising spend be on the same scale as TV or other mainstream media today?  I am more skeptical.  Since I’ve moved to Silicon Valley, I’ve heard again and again how cheap it is to build engaging web experiences.  That’s cool.  But if you are an entrepreneur building one fo these cool engaging web experiences, and your model is advertising, then isn’t there a risk that the advertisers will realize taht they don’t need to spend millions of dollars to create cool advertising?

When Tide makes a TV ad, they are going to spend a few million dollars, as TV commercial production just costs that much.  With a social media widget that Tide might make, will the costs really be on that scale?  I’m skeptical.  I think that some of the ease and speed of developing social media applications will provide opportunities for the big brand advertisers to look for cost savings and efficiencies.  My view here is that while big companies might be a little slow, they aren’t stupid, and they’re generally pretty good about wringing out costs, over time.

It’ll be an interesting development to watch for sure, but don’t bet for a second that the big brands won’t start flocking to and figuring out the social media stuff and how they can use it to extend their brands.


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