People read blogs because they are interested in the thoughts, experiences and knowledge that a blogger has. The best blogs also entertain, too. But what they do not do is paid editorial advertising - that’s for the banner ads. When a blog writer gets caught accepting payment for positive product mentions, what follows is a PR disaster, all the worse because other bloggers feel that their world has been tainted.

That’s why TechCrunch quickly made a big deal of it this week when an intern of theirs got caught being rewarded with a laptop for a post: he got fired and all his posts got wiped immediately. No names were given, and reaction seems to be that TechCrunch’s responded well and maintained their credibility. A few bloggers though, traced the guy’s identity and wondered who was willing to pay him - it’s a known rule of the game that any interests must be declared. The unfortunate thing is that innocent startups had posts about them removed and may also come under suspicion of bribery, too!

If a positive blog post is worth getting, it is prominent enough to get some scrutiny too. If the writer gets paid, the truth will comes out, readers will naturally react in three ways:

1. Not to trust the writer again
2. To assume a company paying for positive mentions could not get them any other way
3. Not to trust such a company

This is something that has not really dawned on some European companies, who see blogging as a legitimate form of paid advertising - in fact, one Swiss social media marketing company, Trigami, bases its business on getting paid blogging coverage. It will eventually dawn on their customers, I think, that this is not what social media marketing really is. The fact that their business model is not big news in the blogosphere is probably simply because they are only doing it in German - if they start with English-language ones, wait for the storm! However, regardless of language, the basic rules of SMM - be open and helpful, and network for all you are worth - may mean hard work, but they are there for a reason!

This guest post on TechCrunch  by Eric Clemons I found really thought-provoking. It is quite a long and detailed argument, pointing out step-by-step not only why advertising is failing on the Internet at present, but why it is bound to fail in the longer run. It’s well worth reading in its entirety, but I’ll just give a summary in case you’re in a hurry.

Clemons says that advertising revenues are falling in the mainstream media because people don’t really trust advertising and don’t particularly want it. For example, broadcast networks put on their advertising the same time so that viewers can’t switch channels to avoid it. Even AdWords, Google’s big revenue source, depends on misdirection, or at least the threat of it. And location-based advertising, pushing messages that you are very likely to want because of where you are, the content of your recent e-mails, where your friends go etc, he thinks will also fail because of the trust issue.

It could be argued that the decline in advertising revenues in conventional media is a natural response to the increasing diversity of information sources, and that Clemons is overstating the user’s role in it, but I think there would be a smokescreen. The real point is that users have more of a choice of ways to find out more about any service or product for themselves, which weakens the persuasiveness of advertising content hugely.

To give my own take on Clemons’s argument, the fact is that advertising clearly works best where information is restricted. Where information is free, easily available, and easy to select and compare, users can easily select between information they trust and information that they don’t. A recommendation by friends or from clearly neutral sources has an inherently higher value. So, as social platforms are more and more popular, their role in disseminating information becomes increasingly important.

We’re certainly not the only people saying that the key is to be authentic, and offer users the information they want when they want it. But Clemons’s critique of the paid advertising model makes the most cogent case for this that I have seen to date. To put it in a nutshell, there are two clear consequences, one for marketing, one for PR. In marketing, the point is to engage the prospect more directly, openly and personally, using the best tools and content you can. In PR, same thing, different target, i.e. the blogger, commentator or analyst rather than the prospect. That’s got to be good for the market, the vendor and the customer.