Is Marketing/Advertising through Social Networking sites as effective as companies May Think....?

While it may seem effective for companies to target audiences through Social Networking sites, statistics prove otherwise. During my research, I came across the statistic that 93% of marketers use social networking sites as a marketing tool. However, 90% of buyers trust peer reccomendations, while only 14% trust advertisements. The advertising process seems a bit backwards......Who do you trust? Think of it this way...when it comes to a weight loss product, which would you trust more-- that phony commercial for that diet pill that suggests it burns 100 lbs of fat in 1 month...or a trusted friend telling you the awesome results she's encountered on a diet plan? Hmmm....