GM employs a lot of people.  GM buys a lot of materials from people that employ even more people.

GM is also a failing business, which has more to do with the fact that they don’t sell a lot of cars than it does with the current economic climate.  The company really liked selling big SUVs to people long after the market no longer demanded them.

Either way, the message is clear.  Give GM $25 billion now or their failures will cost the US $156 billion, not to mention the social consequences of millions of lost jobs.

The channel?  YouTube.  Is this because GM, the #1 media spender in the world, can’t afford TV time?  Probably not.

In reality, this is an example of a company trying to use social media to create a blind groundswell around an emotional issue.  There are some obvious issues here to the even slightly critical eye.  For example, if GM is a failing business that has been in decline well before the current economic crisis then won’t $25 billion just postpone the inevitable and add to the cost for taxpayers?  This issue isn’t addressed because social media is all too often not the right channel for rational debate.  It’s the channel for snowballing emotionally charged issues.

It appears to have backfired on GM.  The video is the lowest rated video of any video on this week’s top 100 on YouTube.  It has also generated more than 1,400 comments, ranging from anti-socialist tirades to far reaching criticisms of GM’s business model.  Any sign of a groundswell of support is buried in negative sentiment.

What’s to be learned here?  For starters, it’s important for all brands to understand that transparency is not something to be taken lightly.  Large brands can’t get away with seeding ideas like this without a full representation of the issue or backlash becomes almost inevitable.  Just because T. Boone Pickens can get away with hiding self-interest behind common interest doesn’t mean the same is true for large brands that have a history of layoffs to undermine their newfound interest in protecting American jobs.

Motrin reacted much as you would expect.  There is an apology on their Web site and they are trying to remove the ads from everywhere they can.  Obviously the ads will never go away and now, thanks to the controversy, they will probably reach more people than originally intended.

So, did Motrin do the right thing?  Were the ads offensive?

I say no.  While I can certainly understand why this can hit a nerve with new mothers, I don’t think the message is that far off for a lot of mothers that probably do feel strange walking around with a baby sling and do feel pain from carrying around the extra weight.  Is it disrespectful?  Not really.  Does it stereotype mothers in a negative way?  Not really.

This is a classic overraction by a company that sees one channel flooded with negativity.  I’m sure this spot could still do very well with focus groups and they’d find that the overwhelming majority of their target market isn’t offended.  The reality is that a few very vocal women were offended and the people they influence just fell in line.  I don’t think this affects their mainstream consumer and, if it did, I doubt the reaction would be overwhelmingly negative.  This was simply an Internet phenomenon and it will soon die exactly where is began.

Yes, listening is important but your reaction is equally important.  If every brand acts like Motrin then all advertising will become so safe and white washed that it will lose all impact and just turn into wasted media dollars.

Plus, have you ever held one of those things for a long time?  Dem babies is heavy!  Baby hauling pain may need something a little stronger than Motrin.

The reasoning is pretty simple, as Nick Denton explains in his lovely blog post about “sleepwalking into economic extinction.”  Cut cost or a decline in ad revenue will mean the death of every living thing on planet earth.  It’s recession 2.0, who wants to out gloom Nick Denton?

Actually, you may not need to.  One of the fun things about Gawker Media is that they publish their traffic stats.  Apparently, Valleywag has been over 3 million page views a month for most of the year (topping 6 million in May).  You don’t need to be a CFO to calculate some modest CPM revenue with that kind of traffic.  It’s common knowledge that Gawker pays their writers absolute crap (trust me, I once interviewed for a job at Gizmodo) and hosting blog content isn’t exactly the same overhead as YouTube.  So why the hell would Denton fold this into Gawker and throw all that traffic out the door (assuming Valleywag readers aren’t loyal to Owen Thomas)?

The short answer is that I don’t know.  For some other projects I’m working on, I’ve been reading about ad revenue models until my eyes bleed and I don’t understand how Valleywag can have the overhead that Denton outlines in his doomsday graphs.  I don’t think he’s lying, I just don’t totally get it.

I do know that if he can effectively merge Valleywag’s audience with Gawker’s audience that he will have a much stronger Web property in the long run.  While Gawker has readers from all over, it’s still essentially a New York media blog.  Conversely, outside of maybe the big tech and political blogs, there is no blog property that resonates with Silicon Valley like Valleywag.  If you see San Francisco as an emerging media market due to the obvious shift online, merging Valleywag into Gawker gives Denton a Web property that reaches both the current center of the media universe and the potential future of the media universe.  The audience reading the next generation of Gawker could be more influential in major media purchasing decisions than anyone reading Ad Week, Advertising Age or any of the old guard.

So whether or not this is a gamble or a necessity remains to be seen.  However, if Morgan Stanley’s numbers in Denton’s post are accurate, seeing online ad growth shrink from 16% to 6% still doesn’t make online publishing a bad place to be for the next couple years.

Charles Cooper over at CNET also chimed in, saying that “PR is killing PR?”  He states that social media isn’t really playing as big a role as empty messaging and weak products/services that are being pushed by PR.  He doesn’t outline an opportunity out of all this except to suggest that if PR goes back to doing the fundamentals of their business better than maybe there will be more success.

Although Owyang touches on it, neither of these points of view go back to the original definition of PR, which is the greatest opportunity that social media has opened for PR agencies.  It’s pretty simple, PR agencies need to teach companies how to RELATE to the PUBLIC using these new channels.  Your grandma probably doesn’t know how to talk to people on social networks and neither do these big brands.

It’s obviously more complicated than just being an individual with few or any stakeholders.  The way a major company handles itself online has major repercussions but that’s the main reason there is an opportunity for experts.

This isn’t just social networks and Twitter either.  PR agencies should be taking over online pressrooms and how the company tells their corporate story through their Web site.  Like I say in most of my new business pitches against bigger badder agencies, your ad agencies can push content and your interactive agency can find new ways to engage people but it’s your PR agency that you’ve always trusted to manage your most important relationships.  Sure, it’s a sales line but there’s some truth in it.

Then, of course, there is the fake New York Times, which predicted the end of PR, as well as the Iraq War.  The prank was trying to show how the world gets better by July 2009, and the demise of PR is part of that Utopia.  Maybe Jeremiah was right, PR should focus on its own reputation too.

There are also misconceptions about social media, like the extent to which Facebook is a global phenomenon and how every major country has their star bloggers.  The reality is that the US is far and away the strongest consumer of what most people consider social media.  Some other countries have higher rates of adoption for specific technologies, like social networks, but no place in the world rivals the US in the influence of the blogosphere.  I also don’t believe any other market would serve as a launching pad for emerging social technologies, like Friendfeed.

Why is that?  China has a larger population online and more broadband users so why is the US ahead, in many respects?  After a recent trip to Korea, I think I have a few of the answers:

1. Privacy - This is largely a social phenomenon but there appears to be a common perception that sharing too much information about yourself on the Internet is dangerous.  This also speaks to the popularity of BBS since it offers a degree of anonimity.
2. Censorship - This isn’t much of a news flash but many Asian countries don’t exactly embrace the concept of free speech.
3. Consolidated platforms - Unlike the various disparate networks in the US, many Asian countries focus their social media activity on a few networks.  For example, in South Korea, Naver is the hub of not only search but also video sharing and BBS.  In China, Baidu is following Google’s lead by launching knock offs of most of the services they provide, which is fine with the Chinese government.

The most striking thing is how closely APAC social media resembles the US market circa 1994.  If you remember back to 1994, the Web wasn’t much of anything and most social activity was happening on major hubs like America Online, The Well and Compuserve (Prodigy was already in decline).  Sure, multimedia content is now much more prevalent in APAC now than it was then but the bulk of consumer generated content is still relatively simple threaded discussions.

What I took away most from my trip to Korea was the opportunity that is emerging in that market.  Politically, Asian countries are becoming more progressive, as is evidenced by their leanings in the US election.  Most of the barriers to social media adoption can be cured politically as governments become more progressive, which I believe is somewhat inevitable.  Then there is the simple fact that broadband penetration is, overall, much more successful than it is in our market and the online population in China alone is going to leave us in the dust.

If I was a VC, and thankfully I am not, I would focus more on the companies that rolling out new technology in enormous untapped markets than the legions of Web 2.0 companies that are pumping technology into oversaturated markets in the US.

Update - Sam Flemming, who is more of an expert than I in these markets, corrected a few of my thoeries in the comments and also offered this excellent link to an article he wrote about how the market is changing in China.

A year or two ago, there was so much irrational exuberance around blogging that it was a foregone conclusion that within a few years there would be five blogs for every person on the planet, no one would get information from any other source and we would have robots in our cars to make us breakfast on the way to work.  Ok, maybe it didn’t go that far but there was certainly no shortage of numbers from the likes of Technorati to make you think that blogs wouldn’t become so prevalent that they would essentially be inescapable.  Sure, blogging was swimming against the current created by traditional media but at the rate it was growing it would certainly take over at some point.

Well…not so fast.

Blogging, like many other infallible social technologies (I’m looking at you MySpace), appears to be slowing down and possibly even in decline.  Technorati has just issued their fifth annual State of the Blogosphere and the numbers aren’t all pointing to the sky.

Sure, many facets of blogging are thriving.  By almost any measurement, blogs now dominate entertainment media, with TMZ and Yahoo’s OMG leaving traditional outlets like People and Entertainment Weekly in the dust.  You see it in technology as well.  It’s hard for me to think back to the time when the WSJ’s Walt Mossberg could be considered one of the most influential people in consumer tech.  Now he’s lucky if he has as many readers in a month as Engadget has in a day.

As with most statistics, the real truth is one or two layers deep.  Are there really 133 million blogs?  Marshall Kirkpatrick of ReadWriteWeb was quick to point out that only 1.1% of them had been posted to in the last 7 days.  As he outlines, that’s slightly less than amount of people that have defaulted on their mortgages in the US over the past year or the amount of people that went to the Minnesota State Fair last year.  If only 1.5 million blogs are active on a weekly basis, is it really such a juggernaut?

What about SOV or traffic?  Here’s what Kirkpatrick says about that:

The average number of monthly unique visitors reported by these bloggers? In the US it’s only 18,000. That means 600 people per day. 600 people reading your thoughts each day is pretty fabulous for the vast majority of people on the planet, but as media goes it’s not very mainstream. Especially if there are only a million and a half people doing it.

It’s starting to sound pretty fringe again, isn’t it?  There were about 35% less blog posts this year than there were last year.  That’s a significant decline.

By the raw numbers, yes, blogging is becoming an increasingly marginalized media channel.  The top 1% may be dominating but I think you can make a case that those blogs are becoming indistinguishable to their mainstream counterparts once they begin relying on advertising revenue.

What I found interesting though was some of the demographic information.  About half the bloggers Technorati surveyed made more than $75,000 a year in household income.  While this isn’t impressive to a lot of the people that will cover this story, it’s still well above the median household income in the United States (the last census in 2006 had the median at $48,201/year).  Maybe this can’t be classified at affluent, per se, but these are certainly people with some purchasing power.

But what about the 600 people who read each of these blogs everyday?  Yes, it’s not a huge number but who are those people?  They are most likely peers, meaning that they are probably in roughly the same demographic.  I’d say a blogger that speaks to 600 people everyday with a median household income of greater than $75,000/year is someone significant, especially to marketers.  Does it really matter how many people Fox News reaches if they are predominantly undereducated low-income individuals?  I’m not saying that they are but we now have a pretty good idea of who is reading these blogs everyday.

So I would agree that blogging has become more marginalized but I think that is also where the value lies.  To go back to my old anti-reach marketing credo, it’s not how many people you’re reaching but who you are reaching.  It’s kind of like the picture above in that the fight against the river isn’t as important when you’re mainly interested in the fish.

Yes, all the hard work you’ve put into learning the ethics, strategies and tactics of PR are now dead because some bloggers don’t find press releases helpful.  May I suggest a career in tasty soy snacks?

Oh wait, it’s just sensationalist blog fodder by people who are acutely aware that PR isn’t going anywhere.  Whew!

There’s a special wrinkle this time though.  The argument is framed as a “doesn’t good technology sell itself?” debate.  Fortunately, if you were born after 1999, you know that the answer is no.

I call this the Field of Dreams theory.  The assumption is that if I have a product that’s really cool then I will sell a ton of them and there will be no reason to promote my brand or “if you build it they will come.”  Isn’t that how the iPod blew up?  Those Hush Puppies that Malcolm Gladwell talks about?  Google?

No, no and no.

Yes, great design can feed demand and generate word-of-mouth.  I don’t think anyone can argue against that.  Unfortunately, none of these products or companies would be able to stay alive without marketing because there’s (thankfully) more to marketing and PR than selling out your warehouse inventory.  Apple would be crippled if they didn’t have a PR team to field inquiries about shipping delays and malfunctioning chips or else misinformation would run rampant and kill their brand.  Yes, Apple.  They have a PR team.

What about Google?  Could they make the acquisitions that have strengthened their business against the will of multi-billion dollar competitors without the help of good PR?  No, they couldn’t.

The list goes on and on.  Bad PR will always exist but the entire industry doesn’t depend on bloggers finding press releases helpful.

So PR isn’t going to die.  And neither will this meme.

BzzAgent disagrees with me.  In a move Ad Rants is calling “desperate,” BzzAgent is guaranteeing that their word-of-mouth campaigns will perform 20% better than other media or you can have your money back (if you’re spending more than $300,000).

So what is 20% better?  Is it 20% more conversions?  WOM is about more than just selling products and services in a one time hit, isn’t it?  Or maybe it’s our beloved Net Promoter score rearing it’s ugly head again.  If you can prove that your banner ads make more people likely to recommend your product then you can have your money back.  Nope, that doesn’t sound right.

The problem in the money back guarantee for me is that it undermines what I consider is the true value of what BzzAgent does.  Over the years the company has built a network of “agents” who are basically people that like getting free stuff to try.  The company is criticized by those who say that these people aren’t influencers but, if we’re talking about candy bars and laundry detergent, one-to-one recommendations from average consumers are just as valuable as one from the hyper-connected.  Is Seth Godin really blogging about how soft his toilet paper is?

BzzAgent is in a unique position as a word-of-mouth marketer.  If you’re interested in seeding a packaged goods product, there is probably no better company to get it out to most major demographics.  They’re ethical marketers who keep their agents informed of the WOMMA rules and have more experience than just about anyone else.

The only problem I have with this is that it once again shrinks WOM down to the campaign level.  Sadly, there are no great metrics of WOM except trying to find out the number of recommendations or somehow being able to track conversions, neither of which are usually an option.  The level of WOM that a brand attains is more akin to brand awareness than it is to most of the common marketing metrics that advertising and PR are based on.  This is a discipline that can only be measured by trend data and I don’t think you can compare that to other media that delivers short term reach.

I side with Contagious on this one.  The guarantee is a stunt that gets BzzAgent some added visibility but it raises more questions about measurement than it attests to the true value of WOM.

For starters, the iPhone will change mobile media habits forever.  I’m not saying that everyone will own an iPhone but I am saying that Apple’s mobile OS runs cleaner and smoother than any interface that is currently available and consumers respond to good interface.

Secondly, with the iPhone comes the only real next generation development platform.  Buying and installing an application on your iPhone is as simple as a couple taps.  This is exactly how Apple pioneered digital music distribution with the iTunes store only it’s slightly easier.

The funniest thing about the 3G iPhone is that the 3G network is pretty much irrelevant.  Most consumers will have a hard time finding it in the wild and unless you’re very in tune with download speeds and are downloading a significant file, you probably won’t notice that it’s “twice as fast.”

Then of course there’s the size, or form factor, if you prefer jargon.  Watching video on an iPhone is actually enjoyable and some of the application developers, like Major League Baseball, are really getting it right.  Sports highlights, YouTube videos and most video podcasts make perfect sense for this platform.  Whether or not long format video, like Hulu or traditional TV/movies, will work as well remains to be seen.

Google is going to be taking a crack at this before the end of the year as well.  They’re great content aggregators but they haven’t proven that they can build a usable OS yet.

Apple has one more advantage here.  They now own one of each of the “three screens.”  They are a juggernaut in the PC market, they’re picking up major momentum in mobile and the Apple TV remains, in my opinion, to be one of the most underrated devices in consumer electronics.  I can’t imagine that syncing media between these three devices is more than 18 months away.  Once that hits, you will be seeing a truly seamless media consumer and it will be interesting to see which channels survive and which fade.

That why I think other brands need to study how Julia pulled off one of the best PR success stories in digital media.

Ms. Allison will grace the cover of Wired this month, talking, presumably, about this very same topic.  Granted, this isn’t exactly Time Man of the Year but it’s certainly the kind of PR hit that could sustain a high tech client for about six months.  But yet, she didn’t discover a faster processor or start a company that allows you to cook an egg on your Blackberry.  She’s promoting her new Web idea, Nonsociety, but she’s really just promoting Julia Allison.

She did it the (new) old fashioned way too.  Julia jumped on Tumblr when it was new and hot and hit the ground running.  She also regularly puts up videos on Vimeo (it never hurts to have dated one of the founders) and she regularly responds to commenters.  When she sees people trashing her on Gawker, she doesn’t sit back and check with her legal team…she responds.  When she’s writing an article for Time Out, she asks her readers for feedback and they give it to her.  She puts it all out there and accepts the consequences.  This is not paid media, it’s PR - the new way.  The result is that she’s found her audience.

She’s also found people who take a lot of offense to the fact that she’s famous for doing nothing.  Although she’s been silent since June, the woman who anonymously writes the Reblogging Julia blog spares no amount of venom in ripping anything that Julia publishes.  Loren Feldman has also taken an unhealthy interest in her, but that too has tapered off once he actually met her.  There are other detractors now too, just as there are legions of people that hate the iPhone, but she’s being sustained by the people that support what she’s doing, which quickly cancels out the naysayers.

The reality is the Julia is one of the best PR minds of a new era of digital media.  Imagine if she put this energy into your crappy product.

Update - As expected, Jason Tanz at Wired covered this in a little more detail, with an interesting twist on why people are really interested.