In the wake of Starbucks (NASDAQ: SBUX) stronger-than-expected earnings, I found an interesting article about a study published by wiki provider Wetpaint and the Altimeter Group. The study suggests that when a company/brand is more active with its consumers through social media (the likes of Facebook and Twitter), it is more likely that the company will have financial success. The study looked at a group of 100 companies from BusinessWeek's listing of the top 100 brands of 2008 and their activity on Facebook, Twitter, and the likes.

According to the study, the brands scoring the highest on the engagement scale saw 18% revenue growth in the past year. Those brands with the least engagement saw revenue decline 6%. Companies that were the most active were classified as "mavens," while the least active were called "wallflowers."

Continue reading Is the use of social networking the key to a company's success?

Is the use of social networking the key to a company's success? originally appeared on BloggingStocks on Wed, 22 Jul 2009 14:40:00 EST. Please see our terms for use of feeds.

Over the past few years, there has been an explosion of social media - as well as many fundings. However, it hasn't been easy for social media platforms to standout.

But, as for Wetpaint, things have been moving nicely. In fact, the company has announced a $25 million venture round (in all, the company has raised $40 million). The investors include: DAG Ventures, Accel Partners, Trinity Ventures, and Frazier Technology Ventures.

Essentially, Wetpaint allows you to create your own social media site - with pictures, blogs, videos and so on. So far, there are more than one million sites - with about a half a billion words (keep in mind that the system is extremely easy to use).

More importantly, Wetpaint has had lots of success monetizing the traffic, which is no easy feat when dealing with user-generated content. Although, Wetpaint's pages are optimized for major search engines, allowing for cost-effective traffic. And now with much more money in the bank, there is likely to be a further push to get users to create many more sites.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.

Wetpaint brushes $25 million originally appeared on BloggingStocks on Mon, 19 May 2008 15:29:00 EST. Please see our terms for use of feeds.