Turns out, you can teach an old cat new tricks.
Despite a customer demographic that seemed to skew anti-techie, Arctic Cat last fall decided to take a ride on the Internet's social networking train by promoting its snowmobiles and ATVs on websites such as Facebook and Flickr.
The Plymouth-based company moved cautiously, devoting less than 5 percent of its advertising budget to social marketing, but noticed results almost immediately. With little promotion, Arctic Cat's link with customers and enthusiasts jumped from 400 to 1,400 users in months.
Plymouth bed manufacturer Select Comfort entered the world of Twitter, a much smaller but fast-growing social network, in August. The company's sleep tips and customer service "tweets," as the short Twitter messages are called, have drawn about 1,000 Twitterati who follow the company's posts.
Blaine-based beauty products company Aveda regularly visits beauty blogs to discuss and promote its product line with potential customers. Hits at its online Aveda store coming from bloggers are up noticeably, company officials say.
As advertisers debate the relative value of social marketing, companies such as Arctic Cat say it's already paying dividends. "You've got to go where the trends are going. This is here to stay," said John Tranby, the firm's marketing communication manager.
According to media industry research, nearly two-thirds of all companies will increase social media budgets this year to catch a ride on the rapidly growing phenomenon. Facebook had 66 million unique visits in January; Twitter has watched visits skyrocket 1,400 percent in the past year.
"In 2008, 41 percent of all Internet users will visit a social site once a month. That's 80 million people," said Craig Pladson, interactive account director of the Minneapolis agency Colle+McVoy.
"It's the fastest growing [advertising] segment. Companies are going to spend $1.3 billion on social networks this year."
Social network ad spending is up 10 percent from 2008 and is expected to grow by more than a third to $1.6 billion by 2013.
The online growth in ad revenue comes at the expense of newspapers (down 15.9 percent in 2008), magazines (down 16.2 percent) and television (down 4.2 percent).
But not all analysts are convinced that a friendship ring like Facebook is a viable advertising medium or that a Twitter news flash service has staying power. Much of their content is mundane, noted Jon Austin, a Twin Cities communications consultant.
"Who cares if you went to lunch and had a great burrito?" Austin said. "People mistake the fact that you can send a message to 100,000 people with the click of a key with the question 'Should you send a message to 100,000 people with the stroke of a key?' The two are not the same," he said. "Once the level of spam reaches a certain threshold, people will stop using these networks altogether."
Arctic Cat has no way to track sales from its social marketing sites. But the company says it's happy just to have people talking about snowmobiles, tracking its snowmobile and ATV teams and viewing videos about the sports.
"We jumped into this to make sure we stay in the game," Tranby said.
Arctic Cat's timing was superb, as consumers 35 and older became the fastest-growing Facebook segment in the past year, according to Insidefacebook.com. The age of Arctic Cat's average customer is 42.
Select Comfort went to Twitter and later to Facebook after it noticed a lot of independent chatter about its beds on the Internet. "We wanted to engage with our owners [customers]," said Gabby Nelson, director of communication. "We wanted to build loyalty."
In the world of social marketing, advertisers supposedly can promote their products in an unobtrusive setting that the Internet user controls. "Consumers are attracted to social media because they're able to have a dialogue with brands vs. the one-way communication in traditional advertising mediums," said Pladson, of Colle+McVoy.
The speed and reach of social networks can be a company's best friend -- or its worst enemy.
Two weeks ago, Domino's Pizza was redfaced over a YouTube video showing two since-fired employees tampering with the food they were preparing. The blogosphere went crazy over the video and views went from 20,000 to 760,000 in 24 hours before Domino's could put out an apology.
"It's about damage control, reputation control, the ability to respond," said Tom Flint, digital strategy director at the Minneapolis ad agency Periscope, which launched Arctic Cat's social networking presence.
The sudden popularity of social networks such as Facebook, MySpace, YouTube, Flickr and Twitter have given advertisers a whole new set of options to reach customers.
Here's one way the advertising works: A Facebook user may list golf as an interest or activity in his or her user profile. Pretty soon, ads for golf clubs pop up on the user's page. Or a user "in a relationship" might see ads for engagement rings.
The bottom line for advertisers is to create a conversation with consumers and remain engaged without high-pressure sales tactics, social marketers say.
"This is the end of one-way dialogue in advertising," said Kevin DiLorenzo, president of the agency Olson. "You used to throw a message out there and be done. Now the message is just the beginning of the conversation."
The fact that Internet use is trackable also makes it a valuable tool to marketers.
"This lets word-of-mouth traffic travel with transparency," DiLorenzo said. "Before, we didn't know about the conversation that happened over the back fence. Now we know."
Another element that makes social marketing attractive to advertisers is the fact that it's wildly popular with baby boomers, a demographic with money to spend.
"Boomers are almost becoming overrepresented," joked Julianna Simon, a brand anthropologist for Olson. But those users tend to be well-educated, have money to spend and want to connect with people from their past.
Aveda's Evan Miller said his company's average customers range in age from the late-20s to the mid-50s. "They're online like they've never been before," said Miller, director of new media.
But some advertising analysts contend the jury is still out on the value of social network ads.
"Remember when we were going to get all of our advertising from the mobile phone? That was 10 years ago. People don't want ads on their phones," said Joe Redden, assistant professor of marketing at the University of Minnesota's Carlson School of Management. "People use Facebook because they want to connect with someone they care about from high school, not because they want to connect with Procter & Gamble."
David Phelps • 612-673-7269