BuyMusic.com is offering a seriously interesting experiment in conventional marketing vs word of mouth networking.
I've blogged on the service and won't repeat myself other than noting a few important characteristics
it attempted to copy the success of Apple's iTunes Music Store
It is a very imperfect copy (socially as well as the execution)
It has spent (and continues to spend) an enormous amount on advertising - the ads seem to target Gen Y
So what happened? It is instructive to look at data from Alexa - all measures of the site activity show dotbomb behavior with only a day of success. Even if every hit on the site converted to a purchase, they are probably two orders of magnitude from Apple's per capita performance - in reality it is worse.
Early on a huge amount of the most trusted form of advertising, word of mouth, materialized. Unfortunately for BuyMusic.com the word of mouth was quite negative. Apparently BuyMusic is trying to retool their site, but the image that has been created over the past few weeks is so negative at this point that a better business decision may be to pull the plug. Perhaps this will be considered an echo of the dotcom world a few years out of place.
It would be naive to claim that word of mouth killed BuyMusic, but it is clearly an important component.
Generation Y is often called difficult to market to - perhaps the fact that they are so connected that they are bathed in much more word of mouth than the rest of us (the mean free path to others they trust may be much shorter than their elders). Before the advent of modern advertising people relied heavily on word of mouth. A shopkeeper could loose his job if he recommended something that was useless and there were few enough products that a rich word of mouth developed for everything.
Modern advertising tried to create a proxy for word of mouth by supplying us with characters, images and phrases we came to trust. Perhaps Generation Y has found a future by going back to the past.