Facebook's efforts to fix its Beacon system show that talk isn't cheap, as marketers increasingly are finding it’s a great way to spread the word about their product. Word-of-mouth advertising has taken off, with nearly $981 million being spent on campaigns last year, a 36% increase from 2005, reports Ars Technica. Companies are now integrating WoM into every campaign.
With research showing 80% of consumers trust friends’ and family recommendations, social networking websites and chatrooms where consumers trade opinions on products have become so important that companies like Proctor & Gamble are buying WoM firms to help take advantage of the media. Critics, however warn WoM isn’t yet “the DVD that replaced the VCR."