• by Catharine P. Taylor , September 3, 2008

I'm always intrigued when I see an agency holding company make an investment or form a partnership with an up-and-coming digital media company, as was the case with last week's announcement that SocialVibe, the social media company run by fellow MediaPost columnist Joe Marchese, has entered into a strategic alliance with the Emerging Media Lab of Interpublic Group, one of the Big Four agency holding companies. (Perhaps "agency holding company" is a misnomer by now, but you know what I mean.)

OK, so given this is a strategic alliance, no investments in SocialVibe were made, but that shouldn't diminish the importance of any big holding company trying to get its arms around social media. Those in the social media business -- as with those in virtually every niche of the digital media business I've ever encountered -- think that getting involved with new forms of communicating with customers is a no-brainer; but as someone who has been in and around the agency business for longer than I care to detail here, it's not, particularly where social media is involved.

Think about it: the traditional agency business is built around carefully crafted, one-way communications where the agency and advertiser dictate the messaging. The consumer is talked at, not with. Social media is its polar opposite. When consumers become part of the communication, they begin to dictate it, and that's not something that adheres in any way, shape or form to taglines, or discrete, 30-second slices of time.

Furthermore, the agency compensation model is, if not perfect, well established. With the compensation model for digital media, let alone social media, still nascent, it's easy to see why the big, established advertising companies are resistant to change. Marchese says of the deal, "What this really signifies for us is that the agencies realize that there is going to be a different approach for social media." In other words, maybe agencies don't get it, but they want to get it. To paraphrase what I think people in 12-step programs go through (of course, I wouldn't know), that's the first step towards understanding. Then again, it would be foolish to think of agencies as the only ones who don't get social media. To some degree, none of us do.

When I talked to Lori H. Schwartz, the senior vice president and director of the Emerging Media Lab, earlier today, what most interested her about partnering with SocialVibe was that it would give IPG the ability to determine "the cost of an influencer." If you're not familiar with it, SocialVibe's business model is to let users promote the brands they want within their own social media outlets -- Facebook pages, personal blogs and so on. The company then ties in a charity component; SocialVibe users earn points for their endorsements that are later paid out in the form of donations towards their favorite causes. The best part, from an advertiser perspective, is that the impact made by one influencer on others is trackable.

As social media is notoriously hard to measure, some who read this may come away thinking that IPG would love nothing better than to somehow define influencers using an easy-to-swallow CPM metric. Still, advertisers need metrics. At least as of this writing, it's pretty hard to justify the "social media" tab on the marketing budget without giving the folks back in accounting some idea of what the return on investment might be.

However, Schwartz realizes that using SocialVibe as a path to understanding social media is but one way to get it. "There's no one answer here," she says. "You have to have a variety of tools in your toolbox."

[On another note, I'm working on the agenda for OMMA Social San Francisco, which is being held on Oct. 27 at the Hotel Nikko. Feel free to email me your astounding panel and keynote suggestions by Friday to cathyptaylor@gmail.com. Thanks, all!]