"Word of mouth is more effective than traditional advertising for two key reasons. First, it's more persuasive. Advertisements usually tell us how great a product is. But because ads will always argue that their products are the best, they're not really credible. Our friends, however, tell it to us straight. Their objectivity, coupled with their candidness, makes us much more likely to trust, listen to, and believe our friends. Second, word of mouth is more targeted. It is naturally directed toward an interested audience....WOM tends to reach people who are actually interested in the things being discussed. No wonder customers referred by their friends spend more, shop faster, and are more profitable overall." -from "Contagious" by Jonah Berger
The beauty of, and opportunity in, social media marketing is that it takes advantage of the key aspects of word of mouth and filters it to an appreciative audience. Bringing the potential influence of our social circles into the center of our marketing strategy is key in today's evolving online universe.