You’ve won. The Gap logo spat is over. In a contrite statement, Gap president Marka Hansen yesterday admitted the company goofed when it introduced a new logo last week without checking first with fans. The original logo – a blue box with “Gap” spelled out in white – stays, placating (for now) thousands of protesting bloggers, Tweeters and Facebook fans. It’s a lesson in customer relations that Frito-Lay is completely ignoring as it plans to shelve its eco-friendly bags of Sun Chips despite a similarly heated public outcry.

According to a recent Nielsen study, nine out of ten consumers trust their online peers more than marketers. Businesses are always looking carefully at their customer engagement strategies to distinguish their customer service from the competition, and never more than now with social media starting to have a major influence on consumer behavior.

According to a new piece of research by Custom Communication, “Social Media Screw Ups – A Short History,” along with the surge in social media investment comes a surge in social media screw-ups by major corporations using these channels to reach the public. 2010 is on pace to see more reputation-bruising social media gaffes than in any previous year. Haven’t they learned anything from the Kryptonite lock fiasco of 2004? Apparently not.

Gap, the slumping clothing chain, has been feeling the heat these past few days after introducing a new corporate logo on its homepage, one that critics grumble looks like a logo for a bank, or worse, a medical supply chain. When hundreds of disapproving comments piled up on its Facebook wall, on Twitter and in blogs, Gap responded by turning the flap into an exercise in crowdsourcing. It now wants to solicit design ideas from you. Could this mean curtains for high-priced creative boutiques?

Facebook’s big announcement on Wednesday is a new feature that gives users the ability to categorize friends into smaller, targeted groups with the ability to share and converse with them individually or on a group level. It’s a great idea for organizations and brands looking to further target their message, but there’s just one catch: Sorry, this feature (for the moment anyhow) is not meant for you.

Twitter engineers revealed a bit more detail about their ongoing revamp of the platform’s search capabilities. The upshot: the upgrade means Twitter will do an even better job of indexing Tweets in real-time to help it keep up with the incredible strains on the network as usage soars.

The new online ad spend figures are out from IAB UK this morning revealing a recession-busting 10 percent year-on-year rise. More impressively, the online ad spend is nearly one-quarter of the total UK advertising market. Yep, £1 out of every £4 spent on advertising in the UK is now spent online with only one direction to go: UP.

Our editorial and social media training partner, Custom Communication, has gone back through six years of social media and compiled a visual narrative of company misadventures with bloggers, tweeter and other social media voices.

Lost in the executive re-org news at Twitter this week is an announcement about its latest attempt at monetizing the 90 million short messages we all send every day: Twitter’s alliterative “Promoted Promotions.” Proceed, shall we?

Is there anyone in business today who doesn’t look on in awe at the extraordinary rise of Facebook to reach 500m users? A powerful symbol of changing times for sure. What is perhaps more extraordinary however, is the sense that despite its success, only the bravest soul would willingly make a large bet that Facebook will maintain its brave dominant position for even five more years. Such is the whirlwind pace of business change in the digital revolution.