Is Social Media really recession-proof?

[Jeremy Williams]

A co-worker at our ad agency send me an article from the Wall Street Journal the other day that mentioned that many firms will start cutting back on social media-related expenses in the face of the economic slowdown.

A clip from the article follows (or read the full piece ($)):

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"Financial woes likely will derail the growth of a slew of advertising technologies that until recently were being hailed as the next big thing.
In recent years, marketers have set aside a portion of their ad budgets to experiment with digital technologies such as Web video, mobile phones, gaming and virtual worlds. But with broader economic turmoil reaching Madison Avenue, these "experimental" budgets are among the first to hit the cutting-room floor.
Chrysler LLC has already slashed its experimental ad buys. With each ad dollar facing additional scrutiny, especially in the hard-hit auto industry, these ad buys will now make up about 5% of the auto maker's marketing budget, down from as much as 10% in previous years, says Deborah Meyer, Chrysler's chief marketing officer.
In good times, the maker of Chrysler, Dodge and Jeep brands tapped technologies like gaming and mobile to build awareness of its vehicles. "We won't experiment in a lot of things that are fun to have. All of our dollars have to go to hitting in-market shoppers with the appropriate media," Ms. Meyer says.
Areas like mobile, virtual worlds and widgets are expected to be hit particularly hard, as it remains unclear what kind of impact ads in these media have. These campaigns often reach a small number of people, and standard measurement systems have yet to be developed. "When we get into the need to drive results, you can't spend money on the experiments and hope to keep your job and get your sales goals," says Peter Kim, senior partner at Dachis, which advises marketers such as Philips Electronics NV's Philips Healthcare and Johnson & Johnson on marketing strategies.

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I know that some people here on SmallerIndiana are owners of small social media companies and others are small businesses owners and more still are employees at larger companies. Has the seemingly-impending economic slowdown caused you to re-think your marketing plan as it relates to social media? Has it made you decide to invest more or less money and resources in social media ventures?

Like many companies, we're at a crossroads now as well. We want to and need to be involved in social media more heavily, but budgets get tight and it's sometimes difficult to decide where is the best place to spend the limited resources.

Does any one have any thoughts, recommendations or opinions?