A Reuters article states: Recognizing the limits of traditional advertising, established technology companies are diving headlong into the sometimes chaotic landscape of social media to promote their products.

Companies ranging from PC maker Dell Inc to storage equipment maker NetApp Inc are increasingly turning to outside blogs, viral videos and websites such as FaceBook, Twitter, FriendFeed and Digg — and their tens of millions of users — to reach consumers.

These social networking sites harness the age-old power of the word-of-mouth recommendation and can be potent marketing tools. If nothing else, they demand a higher level of consumer engagement than conventional ads.

“This is 180 degrees from that sort of advertising,” said Debra Aho Williamson, a senior analyst at eMarketer. “Having a conversation with them (consumers) is a very new skill.”

For tech companies with big marketing budgets, the shift to social media is an implicit acknowledgment that television and print are not necessarily the most effective ways to reach buyers, particularly younger ones

In addition, with a recession looming, corporate budgets are being slashed. UBS has forecast global ad spending will fall 3.9 percent in 2009. In such an environment, social media could prove to be a cost-effective way to sell to consumers.

But the strategy is not without some risk. While every company wants to generate buzz, online backlash can be brutal. Brian Keeler, a vice president at media consultancy VShift, said the key to social media is credibility and enlisting consumers in the act of marketing itself. But if you upset your audience, it can mean trouble.

“With the online media, things can go viral and spin out of control really fast,” he said.

A Rush To Be Social?

Social Media is gaining credibility and momentum with more and more brand turning to the medium especially given the pressure of budgets cuts caused by the economic downturn.

Some recent statistics:

1. 77% of all Internet users read blogs.

2. 45% of all Internet users have started blogs.

3. 30% of blog readers spend most of their time reading news and current affairs blogs.

4. 25% of blog readers spend most of their time reading opinions on products and brands.

5. 36% of Internet users think more positively about companies that use blogs.

6. 32% of Internet users trust bloggers opinions on products and services.

These statistics make it crystal clear why the blogosphere is critically important to marketing and communications professionals. It wields tremendous power when it comes to influencing consumers and their buying choices.

Businesses cannot insulate or control conversations rather they can engage and learn. Instead of trying to insulate relations and control conversations maybe businesses should connect people and encourage conversations that enhance market opportunities between customers and suppliers. Businesses can also become a conduit of knowledge by enabling the sharing of knowledge, one to one to millions. The social web actually is a model of collaborative conversations that build relationships and create opportunities. What business leader would not want to be engaged in the middle conversations that create market opportunities for them to fill?

Whether customer, employee or supplier, they are all people

Most people don’t live in isolation or do they get satisfaction out of attempts to be controlled. Most people like to be heard and seen as a positive influence in business relations and opportunities. Does a business tell its employees “Today we want you to create negative conversations and turn down any opportunity to serve our customers better”. Not likely however the practices of management are creating the same results but no one wants to hear the real conversations or understand the true state of their relationships with employees, customers and suppliers.

You disagree? Then please point us to a swarm of businesses embracing the social web and doing so with the right intent. We can’t seem to find the “swarms of businesses” rather a few seem to be trying to mimic the actions of people for whatever business intent. The cross road of success for businesses is to be able to think and relate like people rather than trying to make people think and relate like business.

Get it? What say you?