A report released this week by Forrester Research talking up sponsored conversations (i.e. paid blog posts) set off a firestorm of online debate.

Forrester’s report states that it makes sense for some marketers to pay bloggers to write about their experience with the brand. It lumps sponsored conversations as a subset of general marketing practices like advertising and PR activities. The author of the report, Sean Corcoran, said in his blog post explaining the report, “For these low buzz brands sponsored conversation is another way to increase discussion about your products.”

Corcoran said as a matter of market forces, there was no turning back with paid posts: there’s a demand and there’s a supply. Bloggers want to be paid and marketers want to pay them. Indeed, the paid blogging market is real and vibrant. Many major brands already engage in the practice. And given that the number of people reading blogs has grown 50% in the past year and continues to grow – one in three Americans online read a blog at least once a month, more marketers are considering the tactic.

Whether you agree or disagree with the concept (I admit I’m waffling on the issue because I know how hard it is for some “non sexy” type of companies to get anyone to even give them the time of day, but also worry about credibility), the release of the report sparked a quick reaction from Matt Cutts, head of Google’s webspam team. Cutts reminds everyone that paid posts with sponsors behind them not only need to be disclosed as such but also must also bear “no follow” tags so as to not fool the Google spider that crawls the Web for ranking purposes. Google is pretty religious about its guidelines and has and will penalize violators because, as Cutts puts it, they “pollute the ecology of the web.”

The premise behind “no follow” tags is to tell the spider that a post shouldn’t count toward a site’s search ranking on Google, because that would constitute buying links as a way to try to increase ranking — something not tolerated by Google.

According to a story on AdAge.com, “Forrester’s Sean Corcoran, who authored the report that set off Mr. Cutts’ finger-wagging, said he would follow up with a blog post that deals with Google’s demands, including spelling out the need to include no-follow tags in paid blog entries.”

Here’s some advice for marketers who may be considering this approach as part of their blogger outreach programs:

• Follow the “no follow” guidelines to the letter and understand the paid post won’t help your search rankings
• Be completely transparent and disclose all financial relationships and understand that any blogger worth his/her salt will follow guidelines to the letter
• Just because you pay doesn’t mean you control. It’s not like advertising. Bloggers need to speak in their own genuine voice, not yours. They are not your mouthpiece and they are free to say something unflattering about you if that’s what they think or feel
• Learn about the blogger first and make sure his voice and audience is relevant to your company/product. Just because a blogger has a big audience doesn’t make him/her a good fit for your company. It needs to be a good fit for both parties.
• Listen before you act

Photo: voxeros on Flickr.