The company encourages bloggers and Twitter users to specify their tastes in restaurants, movies, books and other products, and then to publish those recommendations to their blogs and social network pages.
Advertisers can then see who has favored their products in the past, and how effective their recommendations have been at getting people to click on links. Depending on the advertiser, bloggers and Tweeters will be paid for every ad they send out, or every time someone clicks on the link.
Bindu Reddy, a former Google product manager, started the company with her husband, Arvind Sundararajan, a former Google engineer. Their service launches early next month.
It seems like a natural, for we all recommend favorite brands, online and off, consciously or not. But the Times points out that lack of transparency has been a problem for other firms in the friendvertising game.
John Chow, who “makes money online by telling people how he makes money online” has no problem with transparency, it seems. In October, Mr. Chow’s income from Twitter ads (administered by Ad.ly and Izea) was around $3,000. “I get paid for pushing a button,” he notes, as if it’s that simple.