Brilliant Noise

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hard, along with Twitter, to get music stars at last night’s show to talk up the event to their own social networks.

“You’ve got to look at the ratings and say that there’s got to be a correlation,” says Marc DeBevoise, who heads up entertainment for CBS Interactive. “We wouldn’t be doing it if we didn’t think it was there.”

But Digital Sport is not just about creating must-have sports gadgets. Getting so close to its consumers' data holds exceptional promise for one of the world's greatest marketers: It means it can follow them, build an online community for them, and forge a tighter relationship with them than ever before.

Nike's spending on TV and print advertising in the U.S. has dropped by 40% in just three years, even as its total marketing budget has steadily climbed upward to hit a record $2.4 billion last year. "There's barely any media advertising these days for Nike," says Brian Collins, a brand consultant and longtime Madison Avenue creative executive.

n 2000, Wieden handled all of Nike's estimated $350 million in U.S. billings. Now those campaigns are increasingly split between Wieden and a host of other agencies that specialize in social media and new technologies.

Gone is the reliance on top-down campaigns celebrating a single hit -- whether a star like Tiger Woods, a signature shoe like the Air Force 1, or send-ups like Bo Jackson's 'Bo Knows' commercials from the late '80s that sold the entire brand in one fell Swoosh. In their place is a whole new repertoire of interactive elements that let Nike communicate directly with its consumers, whether it's a performance-tracking wristband, a 30-story billboard in Johannesburg that posts fan headlines from Twitter, or a major commercial shot by an Oscar-nominated director that makes its debut not on primetime television but on Facebook.

It spent nearly $800 million on 'nontraditional' advertising in 2010, according to Advertising Age estimates, a greater percentage of its U.S. advertising budget than any other top 100 U.S. advertiser. (And Nike's latest filings indicate that that figure will grow in 2011.)

Two years ago a group including Stefan Olander, 44, a longtime marketing executive (and Matthew McConaughey look-alike) formally pitched Parker on the idea for Digital Sport, a cross-category division that would take the Nike+ idea -- chip-enabled customer loyalty -- into other sports. Up and running a month later, the Digital Sport division now works across all of Nike's major sports.

The reason for the shift is simple: Nike is going where its customer is.

But as the marketing mix becomes less about hero worship and more about consumer-driven conversation, they say, Nike is insulating itself from an era of athlete endorsements gone wrong. "Everybody's realized there's not the same one-to-one relationship as in the past: When Jordan's hot, his shoes are hot," says a former Nike executive. "I don't know if hero worship is the same as it used to be."

That's not to say everything has been a slam dunk. Nike shut down its Joga network after the last World Cup game in 2006, confusing the million-plus members who'd signed up for it. Its Ballers Network, meanwhile -- launched in 2008 as an app that let basketball players organize street games -- recently had less than 300 users in the U.S.; a recent wall post was a teenager complaining he couldn't get it to work. And critics say products like the FuelBand and Nike+, while dazzling, are more about keeping Nike's retail prices high than innovating.

Diversity breeds creativity--ecosystems are richest where habitats and species overlap. With more connections and diversity comes more creativity: diverse communities are more interesting, more provocative, and more stimulating.

In 2005, Google set a formula for distributing its engineering efforts: 70-20-10. Seventy percent of Google’s resources are devoted to improving search and advertising, Google’s primary source of revenue and profits. Twenty percent is allotted as free time for people to pursue projects of their own choosing. And ten percent is invested in scaling up the most promising ideas that emerge from the 20% time, the wild cards that could develop into whole new lines of business.

Jack Welch, GE: “Size either liberates or paralyzes. We tried every day to remember that the benefit of size was that it allowed us to take more swings.”

Eric Schmidt, Google: “Our goal is to have more at-bats per unit of time and effort than anyone else in the world.”

Jeff Bezos, Amazon: “You need to set up and organize so that you can do as many experiments per unit of time as possible.”

The more things you try, the better your chances of discovering something valuable.

For emergent strategy to be successful, there must be enough autonomy, freedom, and slack in the system for people and resources to connect in a peer-to-peer way, like they do in Silicon Valle

Employees at Mailchimp, an email marketing company with about 100 employees, decide on new features and services in a similar way. If someone has an idea, they attempt to recruit another person to help them work on a prototype or to help convince others. At Mailchimp, people get excited by good ideas, and they are trusted, so they have the autonomy to follow their instincts. To be recruited, a person must consider it more interesting or useful than the things they are already working on. Like the ants, recruitment turns to escalating commitment over time as more people are recruited to the project. When enough people are recruited, a team is formed and commits to seeing the project through to completion. In this way, ideas compete for resources and the best ideas end up bearing fruit.

Two-thirds of the value unlocked by social media rests in “improved communications and collaboration within and across enterprises,”

Far from a distraction, in other words, social media proves a surprising boon to productivity.

Social technologies have the potential to free up expertise trapped in departmental silos. High-skill workers can now be tapped company-wide. Managers can find out “which employees have the deepest knowledge in certain subjects, or who last contributed to a project and how to get in touch with them quickly,” says New York Times tech reporter Quentin Hardy.

the report suggest that tools like Yammer are the tip of the iceberg. Right now, only five percent of all communications and content use in the U.S. happens on social networks, mainly in the form of content sharing and online socializing. But McKinsey analysts point out that almost any human interaction in the workplace can be "socialized"--endowed with the speed, scale, and disruptive economics of the Internet.

echoed of late from the most authoritative of places: Wall Street

Google, Microsoft, Salesforce, Adobe, and even Ellison’s own Oracle--have spent upward of $2.5 billion snatching up social media tools to add to their enterprise suites. Even Twitter-phobic CEOs may have a hard time ignoring that business case.