After penning yesterday’s blog post, I was tempted to do exactly two things: one, buy and consume an entire dozen cupcakes by myself; and two, do some research to see how other local cupcakeries here in Washington, DC, are faring in the digital space.

Since I was closer to my computer than to any of the neighborhood cupcake shops (the closest is half a mile from the FairWinds office – I’ve looked into it), the second temptation won out.

The cupcake trend has swept our nation’s capital over the past few years. I could easily rattle off ten different vendors that specialize in the petite treats. But if pressed, I’d have to say that the shop that started the mini-cake mania in this town was Georgetown Cupcake. On a given afternoon, you can walk by GC’s flagship store on M Street and see the line snaking up the block. TLC even decided to base a reality TV show, DC Cupcakes, on the shop and the two sisters who run it.

But earlier this month, a new player entered the cupcake field here in the District. Sprinkles, which claims to have opened the world’s first cupcake bakery in Beverly Hills, opened up shop in Georgetown a mere six blocks from Georgetown Cupcake’s doorstep. Debate has sparked over which bakery makes more delectable desserts – whose cake is moister? Whose frosting is creamier? For the sake of my waistline, I decided to look into a different aspect of the rivalry – who has the better online brand strategy?

Georgetown Cupcake seems to have its domain name bases covered fairly well – the bakery owns both GeorgetownCupcake.com and GeorgetownCupcakes.com. Sprinkles, on the other hand, owns both SprinklesCupcake.com and SprinklesCupcakes.com, plus Sprinkles.com, an invaluable keyword domain that has helped the bake shop dominate Page 1 of Google results for the term “sprinkles”. Sprinkles also pops up on the first page of results for “cupcakes,” which is impressive. If the newcomer wanted to assert its DC presence, it could register SprinklesDC.com, which is currently available. Strangely, neither Georgetown Cupcake nor TLC (or its parent company, Discovery Communications, Inc.) owns DCCupcake.com or DCCupcakes.com – both point to parked pages and have been registered since 2008.

In the social media realm, both bakeries own their Facebook usernames: Georgetown Cupcake and Sprinkles Cupcakes, respectively. The URL for GC’s Facebook page is facebook.com/georgetowncupcake, and Sprinkles’ is facebook.com/sprinkles. Sprinkles’ 260,000 fans far surpass GC’s 92,000; understandable, given that Sprinkles is a national chain and GC is local to the DC Metro area. But Sprinkles also has GC beat on Twitter – whereas the DC shop owns @GTownCupcake, the West Coast transplant owns @sprinkles and @sprinklesmobile for its cupcake truck. Candace Nelson, the founder of Sprinkles, also tweets from @sprinklescandac and there is even an account for fans, run by fans, @sprinklescupcks.

So while the war over cupcake supremacy rages on, it looks like the digital battle goes to Sprinkles.

And it looks like I’ll be picking up some cupcakes on my way home from work tonight.

Everyone knows Facebook is more or less taking over the world (or at least trying).  As its number of users climbs into the hundreds of millions and its content and functionality continues to expand, people are spending more and more time on the site.  Users increasingly turn to Facebook for news, entertainment and, of course, communication.

One unexpected area where the “Facebook effect” is evident is the traffic to popular email domain names Gmail.com and Hotmail.com.  According to Quantcast, the traffic to each has plummeted since June 2007.  Take a look at the graphs below:

Of course, Facebook’s popularity alone doesn’t explain this drop in traffic.  For example, smartphone users can configure their mobile phones to receive email, and so users increasingly rely on mobile phones to check their Gmail and Hotmail accounts, rather than visiting the Gmail.com and Hotmail.com websites directly.  But you can’t argue that Facebook doesn’t have some hand in this trend.  Facebook is fundamentally altering the way people – especially young people – communicate. 

With the ability to send public or private messages, chat via an instant messenger, and comment on literally everything, Facebook easily fulfills a variety of communication wants and needs.  Instead of relying on email to say “Hi” to an old friend, congratulate someone on a new job or an engagement, or wish a friend a happy birthday, Facebook provides a venue for such communications.  And if the site actually does develop its own email system, as has been rumored, we could start to see an even larger shift away from traditional email… be assured it will be something many people will adopt and “Like” very much.

As many of us are preparing our comments on ICANN’s latest new TLD guidebook, many companies are also trying to determine if they will actually apply for a new TLD if they arrive as scheduled by ICANN in May of 2011. 

Even though many of the previously launched “new TLDs” did not bring about a meaningful shift in online consumer behavior, there is a shared concern among digital executives over not knowing what will happen with this launch, or what the appropriate action will be.

Imagine if Facebook is one company that applies for a new TLD in the first round.  It might make sense; Facebook has had its fair share of username and security issues and Facebook users spend more time on facebook.com than any other site.  The possibility of creating .FACEBOOK domains for each user, such as PhilLodico.facebook, might be interesting to Facebook and it would likely be valued by users as well.

Facebook alone has over 500 million users.  That would translate to 500 million new domain names; tripling the number of domain names in existence overnight.

Now imagine adding in other Internet powerhouses like Google, Microsoft and Apple, and big brands like Coca-Cola, Disney and others.  These companies have enormous reach in terms of customer touch points, not to mention budgets with which – if they wanted to – they could try to shift consumer behavior. 

Between Facebook’s grassroots consumer behavior shift and a possible direct marketing program by brand leaders, there is no question; there is a chance that new TLDs will catch on.

Wouldn’t it be great if we could sit on the side and wait and see what other companies do?  To see if Facebook does this?  To see if 500 million new domain names are registered and to see what consumers begin to do.  It would.  But ICANN isn’t necessarily going to allow that to happen.

The biggest risk that new TLDs (if approved) present is that we only know that there will be one window that opens.  The last time a window opened was seven years ago. What if ICANN gets overwhelmed with this launch?  What if it takes years to process the 500 applications that they are talking about possibly receiving?  What if ICANN is prevented from moving forward with another window because of abuse found in the space?  What if it is 3, 5, or 7 years until the next window opens?

What happens to the brand owners that decided to wait on the sideline if new TLDs begin to catch on?  Those that did apply will have the ultimate competitive advantage while those who didn’t will be sitting on the bench waiting for their chance to play catch up.

While I believe there is still an opportunity to alter if and how new TLDs will be released, this risk of being sidelined is one we all need to take seriously.  And as ICANN has shown us, we need to start thinking about this soon.

Last month, we posted about how brands are beginning to more frequently promote Facebook or Twitter pages in their advertisements.  Well, we recently found even more data pointing to the increased importance of social media in conducting business online.

Nielson data reveals that social media usage has increased 43% in the last year, meaning that the average person now spends 23% of his or her daily Internet time on various social media sites (the largest percentage of any category of online activity).  Data also suggests that Facebook is becoming more of a destination than a traffic source, indicating that consumers prefer to read news, watch videos, and interact within Facebook rather than being redirected to an outside site — even one owned by a trusted brand.

So, what does this mean for brands?  It’s becoming more important than ever to protect your brand in the social media space.  With Facebook as a destination, Internet users are increasingly likely to seek out branded content within the confines of the social space.  However, Facebook and other social media platforms still have a long way to go in developing mechanisms that protect trademarks, meaning brands must take responsibility for diligently monitoring their own names.  Additionally, the informal, community-style structure of the Facebook interface allows individuals who are not associated with a brand to start a group or page reflecting personal opinions on that brand.

While there is no way to completely control conversations about your brand within social media — nor should you attempt to do this — owning your brand’s name and various trademarks as usernames can ensure that users know where to find official and branded content.  Far too many brands have lagged behind on laying claim to their trademarks, division and product names, etc. as usernames, resulting in consumer confusion and negative publicity (need we re-visit the @BPGlobalPR incident?).

The take away for today is that social media is becoming a significant factor in how we seek out and consume content.  Brands need to make sure they are findable on various social media platforms if they wish to be part of the ever-evolving cycle of information consumption.