If you’ve been on Amazon’s Video on Demand store over the past few days you’ve noticed the leading web shopping site is offering up a pretty interesting deal (being run from December 23, 2010 – January 1, 2011) in the form of a promotional tweet offer.

While I could talk rather extensively about the implications of what this type of deal means for mainstream media, the implications on streaming services like Hulu and Netflix, as well as how this type of offer seems to fit so nicely with home video services like Google TV, Roku and TiVo I’m going to limit this post to digital marketing.

So let’s start with what exactly Amazon is offering with their promotional tweet:

Automatically follow @amazonvideo. The message “I just got a $5 credit for instant movies and TV shows @amazonvideo. Click http://amzn.to/hh8gTP to get yours. #get5” will be automatically tweeted from your Twitter account.

What does that mean?

You follow Amazon’s VOD service on Twitter, and then agree to send out one tweet that they’ve pre-formated for you and you receive a $5 credit. For full details you can go here to see Amazon $5 Tweet Offer. (this is an affiliate link – I could not find a clean link to share this with, without sharing my personal customer info with all of you.)

Pretty sweet little deal. What is particularly interesting is how effectively Amazon is using Twitter to create a viral promotion. What is also interesting about this promotional tweet offer is that it is not limited to new customers only – anyone including existing customers can participate in this offer which is great because now Amazon has effectively encouraged its best fans, it’s existing customers, to also become their most vocal advocates.

To give some further perspective to what this offer means, a one day rental of ‘The A-Team’ is going for $3.99 a day.

So basically, one promotional tweet sent by you along with following Amazon’s VOD service on Twitter will give you a free movie rental on what is likely the busiest movie rental time of year. How brilliant. I’m looking forward to hearing how many new customers Amazon nets in this process, and further how many of those new customers go on to rent at least 5 movies over the course of a year (let’s assume Amazon earns $1/movie – you can see how quickly they break even).

I have a suspicion that a big piece of digital marketing in 2011 will utilize similar marketing mechanics, using social media to further viral promotions, but I thought this one in particular was extremely interesting given the players involved. What I like about this sort of marketing is that you are incentivizing people who ostensibly already like your service (they are using it after all) to promote your service to people who are in theory like minded (their friends, colleagues and contacts) – the assumption being that their friends are also likely to enjoy your product or service. An added benefit for the product or service is that there is an implicit endorsement being made by the original sender of your message which is being sent directly to their network.

If you are a small business owner a few great takeaways from Amazon’s promotion:

1) engage your biggest fans, your existing customers
2) give those fans a really great reason to promote your business (an offer)
3) create avenues to allow new customers to benefit from you offer starting on day 1
4) put in place easy mechanisms (in Amazon’s case for this campaign it was Twitter) to create a viral marketing wave.

Meanwhile, as of the publishing time of this post, you still have a few hours to participate…