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Another definition
A plug has this definition in relation to advertising:
"An advertisement, not in the form of a formal ad, but usually a mention?either written or in a publication or given verbally from the platform"
It's meant to be informal, to give the impression that the person 'really' means they like the product/site...so, a plug on a blog would be a casual mention in a post, probably with a link to the site/product...not just a link exchange or some such.
Hope that helps...
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