April 20, 2005--Online personal journals (weblogs or "blogs") are becoming more popular with small businesses that see them as an inexpensive marketing tool and a way to differentiate themselves from the competition.

The main reason more businesses are blogging is because the tool costs little or nothing to use, which is attractive to businesses with small marketing budgets. Additionally, it is a good way to be heard and stand out from the crowd.

"Blogs are a way for you to tell your story over and over again, and do it in a personable way. If you are blogging and your competitor down the street is not, then it can be a competitive advantage," said Paul Chaney, principal of Radiant Marketing group, a blogging consultant firm focused on small businesses.

Currently, only a few Fortune 500 companies have launched blogs, such as Boeing, Sun Microsystems, and GM; however, smaller businesses seem to be adopting them more quickly.

"Blogs are tailor-made for small businesses, and they are a better tool for them," said Anita Campbell, editor of the blog Small Business Trends. "Large businesses have to worry about what they can say in their blogs. They have to worry about SEC regulations and their different constituents, so small businesses have a better chance of making blogs work for them."

That's not to say smaller businesses will not have issues when leveraging blogs for marketing purposes. They can be dangerous tools if they are not used cautiously. Businesses need to watch out for the type of information employees post, ensuring proprietary information is not shared. Employees also must evaluate the consequences of writing for blogs, which could inadvertently cause corporate scrutiny if questionable material is posted.

Despite the risks, blogs are gaining ground as credible sources of information with Internet users. According to a recent survey by Hostway, a Web-hosting and managed services provider, 45% of 2,500 respondents feel blogs are as or more credible than television commercials, and 45% feel that blogs are more credible than Internet advertising. Forty-one percent feel blogs are as or more credible that radio advertising.

Business blogging consultants agree that it is yet to be proven that blogs are a good direct-response marketing tool, but they can be an excellent tool to build relationships and create brand equity as more Internet users see them as viable sources of information.

"Blogs can help in networking and creating industry contacts and business partners. They can also be excellent selling tools, particularly with affiliates," suggested Campbell.