KEY POINTS:
They're usually associated with staff wasting company time, but businesses are seeing new potential in online networking sites.
Blogs and social media websites such as Facebook and Bebo are being used to sell products as diverse as home loans and pole dancing.
Marketing lecturer Mike Lee, of Auckland University Business School, said low set-up costs and the popularity of social media with children and young adults were leading more businesses to use the new media.
Lee said the interactive side of social media appealed to consumers, who were becoming more and more web-savvy.
"Consumers are getting a lot smarter. We do a lot of our own research and we want to know we can have our say."
Marketing consultant Simon Young said social media levelled the playing field between companies and their customers.
"With TV [advertising] you can write a letter to the advertiser, but it's not really the same. With social media, the consumer speaking back [to the company] has just as much ability to be heard as the original speaker."
Young, who helps businesses get to grips with social media through his consultancy iJump, listed international consulting firm Ernst & Young and a new Christchurch pole dancing club as two very different examples of companies that had benefited from social networking site Facebook.
Ernst & Young were among the first companies to set up a recruiting page on Facebook, aimed at recruiting the thousands of entry-level graduates throughout the world it needs each year.
Young said some businesses felt uncomfortable about their lack of control over what was posted on social media sites.
But he said opening a business to scrutiny was what made social media advertising work.
"It's conversational rather than just a one-way broadcast," says Young.
Lee agreed businesses using social media should be prepared for a two-way conversation.
"A one-way push of information doesn't work any more. You want people to engage."
