The Economist has a special section this week on social networking.  They include the chart below pointing out that friend recommendations are the most trusted source of product information.  What’s interesting here is just how far ahead friend recommendations are from the next closest source; eyeballing the “trust completely” bar, the factor appears to be almost 3X.

So if trust is important in your sales and marketing, you really need to be thinking about how to harness the power of social networks.

Here’s an article in AdWeek summarizing the findings from a recent Nielsen study of consumer trust.  “Recommendations from people known” is by far the most trusted source of input — 20% ahead of the next closest.  Nielsen gathered opinions from 25,000 internet consumers to produce this chart:

Most of the books I “read” these days are audio books.  Last year, that included Charlene Li and Josh Bernoff’s excellent Groundswell.  (Here it is on Audible.)  As a result, I missed this extraordinary chart, and just discovered it today.  So it’s not exactly breaking news.  But even if you’ve seen it before, it’s worth a second look.

There are lots of reasons why advice from friends is so much more influential than advice from strangers.  Trust is a big one.  The Wall Street Journal today has a piece about the growing sway marketers have over product recommendations online.  “Paid to Pitch: Product Reviews by Bloggers Draw Scrutiny.”  I was particularly struck by the marketer who requires bloggers he hires to use a seal that says “Sponsored Post.  100% Real Opinion.”  It’s so murky.  Even if the overwhelming majority of amateur reviewers have no commercial interest (or hope of one in the future), the fact that some do undermines trust in the rest.  There is always something comforting about knowing that the person you’re getting advice from is putting you first.

The communications agency Universal McCann recently published a report called “When Did We Start Trusting Strangers?” looking at how much more influential the advice of strangers has become in purchase decisions since the rise of social media.  Brands better not ignore this call to action — like it or not, the phenomenon is real and powerful.  And in many ways it’s a good thing, putting more pressure on brands to produce superior products instead of just superior marketing.

But it’s not entirely a good thing.  To the degree that these anonymous interactions replace authentic, personal ones, they represent lost opportunities.  We end up with better stuff and fewer friends.  When we get advice from strangers on a blog instead of calling our friends, is it because we trust strangers more?  Because we enjoy the experience more?  Or just because it’s so easy?  Hey, there are a lot of strangers in the world - some have already written down their opinions on whatever product you want to know about.

But if it were just as quick and easy to find advice from friends as from strangers, which would you ask?  If you said “friends”, why?  Because you trust friends to give it to you straight?  Because you know them well enough to calibrate their advice?  (e.g. I know Gwen is picky, so if she says it’s good, it’s good.)  Because it gives you a reason to check in with someone you care about?  Even in the McCann study, in response to the question, “How I share opinions of products, brands and services”, the personal forms of communication (e-mail and IM) rank 50% higher (!) than the impersonal ones (blogs, reviews, comments).  (Page 29.)

In the next phase of the web, we’re going to see our real world relationships woven into our on-line experience everywhere we go.  (Charlene Li says social networks will be like air - they’ll just surround you.)  And when that happens, we’ll see the pendulum swing back from stranger-advice towards friend-advice.  And that will be a good thing, too.