Cisco likes to have fun when it engages in social media marketing and the effort is paying off. That’s clear from a long interview with Doug Webster, director of strategic communications in Cisco’s worldwide service provider marketing division, that appeared on the Econsultancy website this week.

For example, about two years ago, Webster’s team was asked to develop a cult following for Cisco products, which is difficult, because most people don’t even see the products that are in the background or the infrastructure. So, for the launch of a router called ASR 1000, it enlisted fairytale characters from Santa Claus and the Easter Bunny talking about how dependent they are on the network and what would happen if they have reliability issues on Christmas Eve.

The microsite, YouTube, Twitter and Facebook campaign allowed people to send this to friends, and along the way, it encouraged them to register for a virtual event that was on this particular day to find out what it is that’s going to save Christmas, Cisco had 8,000 different members of the service provider community online at the same time for this reveal, and the overall results were about six times more than a launch it did in the traditional way in 2004 for about 1/8 the cost. It also ran a tournament that had over 50,000 participants around the world.

Webster says social media and social networking definitely are much more cost effective than other programs, although Cisco is not abandoning older ways of doing business. It’s just shifting the weight. When Cisco has major launches a couple of times per year, about 25 percent of the budget is dedicated to more traditional things like paid placement, and about 75% is for more Web 2.0 social networking, social media outreach, content production, virtual, online events.