By now most of you will probably have read about Reverb Communications, which has had to settle with the US Federal Trade Commission for misleading consumers online.

The PR company was accused of writing positive reviews in Apple’s iTunes store without revealing it was being paid to do so. The PR company is alleged to have posted reviews about their clients’ video games ‘using account names that gave readers the impression the review were written by disinterested consumers’.

The FTC said that advertisers should not pass themselves off as ordinary consumers touting a product, and endorsers should make it clear when they have financial connections to sellers.

This is yet another example of a PR company failing to understand the culture of social media. You have to be transparent – otherwise you are going to get burned. Without transparency there is no trust. Other established PR agencies have fallen into the same trap, with damaging repercussions for the companies they represent.

Leading organisations need to be very careful about taking on mass media, established PR agencies. ‘Astro turfing’ (ie faking grass roots support online) as it is called – will get more exposure as the social web spreads; and companies caught doing it will lose the trust of their key stakeholders and could face the ridicule and outrage of bloggers and users of Twitter and Facebook.

It is in the interests of companies to be transparent and honest as spinning can be exposed so easily online. Traditional media spinning does not work in the networks of the social web. Openness is the best PR you can have. And that is not something that PR agencies have traditionally been good at.

You can catch up on the story here.

Could social media take over from television as the premier advertising channel? That’s the question asked by Deloitte UK in an interesting new study.

At present the relationship is more symbiotic than competitive. The firm’s survey of 4000 adults underlines in particular how social media is helping to amplify the reach of television and finds the effect is particularly strong among 18-24 year olds, who comment on social networking sites at least occasionally on programmes they have watched. Obviously, online recommendation can be make or break for some programmes and commercials.

But the study also suggests that the relationship between the two could become more adversarial, as social networks continue to expand their reach and value, and start to attract more advertising revenue than TV. With precise targeting and real-time measurability, social media enjoys advantages which TV just can’t match, it argues.

The report has been given to attendees at the Edinburgh International TV festival, and can be requested here.

Hyundai is the latest car maker to shift to social media for its advertising. It’s innovative launch campaign for the 2011 Sonata this summer uses conventional television ads but centres mainly on testimonials from prospective buyers on YouTube and Facebook.

The company’s Facebook page invited applications to join a test drive campaign and post uncensored comments recorded by a hidden camera. These are also featured on the TV spots and YouTube.

More details here.

Some leading organisations are reticent about engaging with social media, others are more proactive. The risks of doing nothing though are high.

Here is a list of a few of the risks if you do nothing with social media:

1) You will not see or hear what your customers are saying about your brand and product and services

2) You will not be where your stakeholders are

3) Disaffected customers could coalesce around you in seconds and you will not be prepared

4) Your brand/organisation will lose relevance

5) Your recruitment will suffer because new talent will not have time for an organisation that does not use the latest social media tools for business communications

6) Your competitors will move into this space and gain advantages over you

7) Customer complaints will fester and go unanswered

8.) Your recruitment costs will continue to rise whereas social media can slash the cost of recruitment

9) You will squander the opportunity to set the news agenda by using tools like Twitter to publish your results

10) NGOs will capitalise on your dinosaur-like attitudes by moving swiftly and setting up groups on Facebook and building online coalitions

11) Investors will read forums for insights into your business which you will not know about

12) You will not reach stakeholders who do not read newspapers or who do not watch much television

13) You will fail to see how journalists are using social media for research for their stories

14) You will be vulnerable to a Twitter story leading search engine queries about your firm

15) Opportunities for coverage of your stories will shrink as traditional media shrinks

16) Contact books based on established media will lose their influence as bloggers become more influential

17) If a crisis breaks, you could be advised by a PR agency whose mindset -led by an old board – has been deeply defined by the rules of established media. Which means the advice you receive could be suspect as it is not attuned to the new fast-evolving culture – even though they might say it is!

18) Younger members of your organisation who are more open to social media will feel disenfranchised and morale and productivity will drop

19) You will miss out on opportunities to leverage these new tools to boost your communications messages

20) Your company will be seen as faceless and not accountable or open

21) Your communications will be based on a broadcast model at a time when users of social media are not impressed by adverts shouting at them to buy products and services

22) Your press releases will not gain coverage

23) Your content will not be easily found

24) Your messages will become inaccessible

25) People will not visit your website in significant numbers or for any lengthy period of time

26) You will fail to capitalise on the marketing opportunities presented by these new disruptive social technologies

27) You will fail to see the value in treating your customers as partners and jointly developing new products with them

28) There will be no opportunities for you to have direct one-to-one conversations with your customers

29) You will be left behind, be playing catch up and fail to use social media to expand your customer base

30) People will not know the true story about your business

31) If you are slow to engage with social media you will be slower to learn and you will lose competitive advantages.

I could go on. Essentially the status quo is no longer a strategy, as probably most of you know. You have to be where your stakeholders are, whether you like it or not.

Feel free to add any other points. It would be great to have your thoughts too!