• by December 31, 2007

I tend to shy away from alarmism. And frankly, predictions of doom seem downright rude so early in the year. But the more I think about it, the more I realize there is a shift happening in our industry which could effectively make the idea of paid advertising redundant. Specifically, if companies allocate their creative resources to inventing really useful products and creating interesting brand experiences, the social media word of mouth will take care of the selling.

We've all known for a long time that companies with good products that pay attention to their user experience can build big, profitable brands without recourse to traditional advertising. Virgin did it, Starbucks did it, Geek Squad did it. Led Zeppelin did it, too, and the great John Paul Jones related his experience to the current day recently: "When we started, we didn't have much press, but it was all word-of-mouth. They'd call each other up and say, 'We've just seen a great band - you need to come and see them.' Now you do it on MySpace, but it's essentially the same."

What's different now, of course, is that word-of-mouth is writ large. Which makes me wonder whether examples like those might start to become the rule rather than the exception.

A study conducted last year offered more support for this view. It looked at the increasing importance of consumer reviews in purchasing decisions and found that about 75 percent of shoppers say that it is extremely or very important to read customer reviews before making a purchase. And they prefer peer reviews over expert reviews by a 6-to-1 margin. It makes sense, really. We've always sought out the opinions of others before we make decisions. The beauty of peer reviews is that you can look at a lot of reviews very quickly and get a real picture of the strengths and weaknesses of products.

You can't get good and varied reviews in every category yet. But in those where they exist, such as travel (TripAdvisor) and musical equipment (Musician's Friend), those reviews become invaluable. In both categories, I have been actively dissuaded from buying a product I planned to buy and conversely, I have been actively persuaded to buy a product I hadn't heard of. And in both cases, I've been very happy with the results. It definitely changes the nature of purchase decision-making. And it moves it further from an emotionally driven decision (that can be effectively enhanced by traditional advertising) toward a more rational decision that is less easily impacted by traditional communications.

Is that enough to predict the end of the traditional communications industry? Maybe. When you combine the incredible growth of social media with the increasing influence of CG product reviews, it does start to make you wonder about the future of advertising. Who needs it?

Well, there is one thing that advertising is needed for now, which is to initiate the conversation about a brand. In my experience, even when you have a category-busting, innovative, benefit-laden product to your name, the cultural conversation doesn't begin easily. It requires stimulus. Advertising plays that part very well. But would a free sample of a great product work just as well?

I'm sure you've heard the story of the Ogilvy creative director who was briefed to come up with an online promotion to give away 45,000 tickets to the opening day of Six Flags. The clever fellow posted them on Craigslist and they were gone in five hours.

Could it really be that simple? Make a good product. Offer a free sample. Spark the conversation. Let the brand build itself. Oh dear. Where does that leave us?

Well, for a long time, it's going to leave us exactly where we are now. It's going to take some time before the majority of brands are, in fact, good, creative and useful enough for people to want to recommend them to their friends. And until that time, those that aren't will need to be promoted even more aggressively to try and counter the effect of poor consumer reviews.

But it's a depressing thought: We will eventually become responsible for the promotion of only bad brands. Unless of course we recognize the shift and restructure our own businesses to take advantage of it. I know that's what we'll be doing. And I think it's going to make for a happy new year.

Paul Parton is the brand-planning partner at The Brooklyn Brothers, a creative collective. (paul@thebrooklynbrothers.com)