As part of their continuing coverage of Advertising Week 2008, AdWeek has brief, but insightful recap of the first Facebook Spark Series discussions. Money quotes:

• “The definition of a big idea, said Rei Inamoto, co-chief creative officer of AKQA, differs on the medium. “It’s what you do [rather] than what you say that becomes the idea,” he said.”
• “Advertisers have been putting up brand pages on Facebook, but this is a “complete misuse” of the space, according to Richard Ting, vp and ecd, mobile and emerging platforms group at R/GA. He likened that to a billboard set up on the side of a street. What are missing are the elements of utility and entertainment all at once, he said.”

Large brands spend billions of dollars every year on advertising. More and more brands are migrating their ad dollars online, following their target audiences from print to digital. A few of those large brands talk about how much they are allocating to social networks. Find out what has worked and what hasn’t as well as the hurdles for brands getting on social networks.

Two important reports were released today with enlightening perspectives on social networking and online communities. Jeremiah Owyang of Forrester Research released their Best and Worst of Social Networking, 2008, and Deloitte release the 2008 Tribalization of Business Survey, where the WSJ reports on the study’s findings of why most online communities fail.

The Forrester report has some of the more interesting results, with a great report card of notable case studies:

Forrester applied its Social Network Marketing Review methodology to programs run by 16 firms in four industries: automotive, media, technology, and consumer products. Only the BMW Series 1 received a passing grade, and half of the firms scored a zero or lower. But even with these dismal overall results, we found examples of specific best practices: The Dell/Microsoft (Red) program provided a rich media theme that was easily sharable, Sony’s BMG page for Alicia Keys was personable and interactive, and Kraft’s DiGiorno Pizza delivered a unique interactive experience with its members. To improve social network marketing, brands must develop community-centered content and activities, measure success based on new criteria, and be prepared to participate.

Owyang continues:

Although some of them have changed since we first started to judge the 16 social network marketing efforts are:
Note: A passing score is a minimum of 8.

Automotive
BMW 1 Series scores a 9 (Pass) read more
Mazda3 scores a -1
Chevy scores a 3 (who sponsored the effort at the time)
Ford scores a -4

Media
HBO’s Entourage scores a 2
FOX News scores a -4 Disney: Enchanted Movie scores a -4
Sony BMG’s Alicia Keys scores a 7

Technology
Samsung’s Blast scores a -3
Dell/Microsoft (RED) scores a 6
Microsoft’s Windows Server Live scores a 6
Intel scores a -5

Consumer Products
Nike scores a 2
Kraft’s DiGiorno Pizza scores a 5
Pepsi’s Aquafina scores a -2
Mars: Skittles & Starburst scores a 0

Where Owyang’s report focuses on social network marketing, Deloitte consultant Ed Moran also provides helpful insights into why so many online communities fail.

Thirty-five percent of the online communities studied have less than 100 members; less than 25% have more than 1,000 members – despite the fact that close to 60% of these businesses have spent over $1 million on their community projects.

Moran points to several missteps organizations continue to commit:

1. They have a tendency to get seduced by bells and whistles and blow their online-community budget on technology.
2. They don’t properly staff and manage the online community.
3. They measure the wrong metrics.

For the brand looking to participate in online communities, hopefully these latest findings will steer them in the right direction of developing a solid strategy of engaging their customers in existing networks, like MySpace and Facebook, with the proper staffing in place to do their brand and customers justice.

Banner advertising has long been the bane of web surfers around the world. Garrish, annoying and ineffective, it’s rare that a campaign actually expresses any level of creativity or effectiveness.

As social networks entered the scene – ripe with rich, detailed demographic data about each and every user – advertisers simply couldn’t resist. But, an odd thing happened on the way to targeting users in online communities. No one clicked on the ads.

It seems once inside the walled garden of Facebook or among friends on MySpace, users weren’t in any mood to search for new mortgage rates or purchase airline tickets and avoided the ads at all cost. In the latest attempt to earn more clicks through banner advertising on social networks, the social media advertising firm SocialMedia launched “social banners,” which create banner ads that incorporate you or your friends into the ad. CNet writes:

For example, instead of a banner advertising The Incredible Hulk movie, a social banner would ask which of your close Facebook friends, among a short list, you’d like to invite to see the movie. Or a social banner might inform you that a friend Jim just ranked Iron Man with three stars, and it might ask to “click here to buy tickets at Fandango.”

While the intent may be, “to make ads suck less in social networks,” said Seth Goldstein, founder of San Francisco-based SocialMedia Networks, this move could bring a backlash similar to the Facebook Beacon uproar from last year. The privacy issues that arise are incredibly complex.

When it comes to social networks, brands need to think differently about how they engage with customers. There are far greater opportunities to earn customers through providing meaningful service and marketing that has value. Banner ads that are enjoyable and valuable are still too few and far between, and leave most of us feeling like this:

Read the full story here.

Feel free to follow/subscribe/be my new friend here.

Cheers.

Fred Wilson writes: “You cannot be a destination exclusively on the Internet anymore.”

Hopefully YouTube will also be able to successfully monetize increased distribution in new ways, and encourage other content owners that focusing on distributed content not only builds brand awareness, but is also profitable.

[UPDATE]

In addition to increasing content’s distribution online, it needs to go hand-in-hand with being available on multiple platforms. Disney president and CEO Bob Iger said just as much at the McGraw Hill Media Summit:

“Brand managers look at technology with a deep-rooted aversion,” he said. “People take a protectionist view of it, but we’re projecting the brand versus protecting the brand.”

The article goes on to say:

Iger stressed how social media was far from a Gen X or Gen Y fad, but in fact a part of everyday life for children. He said the computer will soon supplant the television as children’s screen of choice. “In the years ahead, broadband on the computer will be the primary source of entertainment for kids,” he said. “It’s just as important to them as the TV set now.”

It bears repeating: from this point on, content needs to be distributed far and wide, and we need to develop the new models for metrics and monetization. The old ones just won’t work anymore.

Massify members (membership is free and anyone can join) are offered a platform to promote themselves and whatever current projects they are involved in, and are also eligible to vote on other users’ film ideas through online competitions in which members vie for financing and distribution from Massify and its partners.

And after granting money to winners of its online competitions, determined by popular user vote, the investors in Massify will maintain a financial interest in the films that originated there, and help produce and bring them to market.

Brett Icahn, Massify’s other founder, said: “Online networks should apply a democratic process to the creation of content, not just the distribution of it,” he said. “The Massify community crowdsources the best ideas, and elects the best actors. It’s more a production network than a social network, because it’s driven by a creative purpose.”

While Massify will face a lot of challenges unique to the film industry, I’d love to see them succeed. Building a community dedicated to creating a wonderful product through a collaborative experience is a powerful tool, and its a model I think more brands and organizations will soon adopt, especially as more tools come into place to better empower audiences.

And while I’m excited about what these numbers mean for social networking and subsequently social media, I’m concerned for the for the company that reads this news today and jumps to the conclusion that this means they need to rush out and build their own social network to capture their slice of the pie.

What they should be doing is taking a deep breath, and carefully evaluate what it means to join the conversation with the people and customers they care about.  The beauty of online communities is that there are countless ways to meaningfully engage and participate. True, for some companies a killer niche network will be the perfect tool. But for most, finding a simple, sustainable and genuine voice in the conversation will be just the right fit.