How did the hashtag go from a neglected computer key to a part of everyday conversation?

A decade ago it was little more than a curiosity at the bottom right-hand corner of the telephone keypad, quietly fulfilling its primary function of providing a bit of company for the zero key. There was little consensus on what to call it; in the US it was the pound, while others called it the cross, hex, square, or number sign. These days, however, a whole new responsibility sits on the shoulders of these four intersecting lines.

Across Twitter, Instagram, Tumblr, Google+, and soon (if rumours are to be believed) Facebook, the hashtag is supposed to help us cope with the information deluge by serving as a categorising symbol, a tagging device. Click on #kittens, and you should see kittens. Click on #m11, and you might discover information about the current state of a motorway running through Essex. But hashtags have strayed way beyond the internet. They now appear on billboards, television show titles and product packaging; if you're brave enough to watch MTV's Geordie Shore you'll hear the word "hashtag" dropped into casual conversation, while Ed Miliband's recent response to the Budget in the House of Commons featured the clumsy phrase "hashtag downgraded Chancellor". We're in the middle of a hashtag epidemic. But what purpose, if any, do they serve?

User-experience designer Chris Messina had big dreams for it. Back in August 2007 he tweeted to his followers: "how do you feel about using # (pound) for groups?", and in doing so unwittingly kickstarted the phenomenon. The # sign was already used to signify groups or topics on the online communication platform IRC, but it took time for Messina's idea to percolate through Twitter. The tipping point coming in 2009. Early that year the #followfriday tag became a convenient way of telling people about new and interesting people to follow; June saw hashtags become a tool of citizen journalism during the protests following the Iranian election, and in July Twitter linked all hashtags to a search page containing tweets featuring that tag. This was a pivotal moment; it brought clarity to how hashtags could and should be used, but also demonstrated their chaotic, ad-hoc nature.

Anyone can create a hashtag, and anyone can use that hashtag in any context. So they can't be controlled; they're used to bring order, but they can easily create disorder in equal measure. The prospect of grabbing attention on social media, however, is a temptation that brands can't resist, and they've embraced the erratic hashtag with a passion. "'Engagement' has become the holy grail for advertisers," says Katy Lindemann, a freelance strategic planner. "It's a largely meaningless term, but it's usually a melée of different metrics that are used as a proxy for 'paid some kind of attention to our thing'."

But there have been many instances where brands have tried to get people to "join the conversation" and failed. When, in 2009, a social-media underling working for Habitat decided to advertise £2,000 gift cards tagged #mousavi (the name of the Iranian opposition leader), there was an immediate outcry. But others found themselves following in Habitat's footsteps; the roll call of disastrous trips into hashtag land includes such respected names as McDonald's, Qantas, Vodafone and, um, Hertfordshire Police.

The world of marketing, however, remains undaunted. Whereas in the past we might have been exhorted to note down a URL, or search for a term on Google, the hashtag is the new call to action – and, in many cases, has become the tagline for an entire advertising campaign. In recent months, Adidas has instructed us to #takethestage, Diet Coke to #showyourheart and Nike to #makeitcount, all with the hope of "igniting" some kind of "digital conversation".

"The theory," says Amy Kean, head of consumer innovation at social-media marketing firm Socialyse, "is that the hashtag can build a bit of intrigue. We recently promoted a Marian Keyes novel where one of the characters had a shovel list – people who she wanted to hit in the face with a shovel before she died. The hashtag #shovellist was a way of getting people to take part in the campaign without explicitly telling them to buy the book."

Chris Messina probably never envisaged that his beloved hashtags would, one day, be used by people to unwittingly promote products, and it's evident that much of their original purpose has been lost.

"Marketing hashtags are pointed internally, at the board," says Dan Shute, Managing Partner at advertising firm Creature, of London. "Graphs can be drawn to show the CMO just how exciting the conversation is around their latest activity. But they very rarely offer any kind of benefit to real people – or 'consumers', as we insist on calling them." The supposedly imminent introduction of hashtags to Facebook is similarly unlikely to benefit its many users, other than to gather information about their interests and facilitate more targeted advertising.

But there are still glimpses of Messina's original vision. The hashtags that appear on television before programmes start have facilitated a rich back-channel of discussion surrounding that show – with perhaps no better example than the BBC's Question Time. "Independent columnist Grace Dent has often said that Twitter is like a massive sofa that you can sit on with all your friends and watch telly together," says Nat Guest, whose weekly BBC Question Time "watch-along", in east London, is almost a real-life manifestation of a hashtag. "On the night we actually have two separate hashtags projected on to the wall," she continues. "There's one for the tweetalong itself (#QTwatch) so that we can speak to each other and see how people are reacting within the room, and the official #BBCQT one so that we can see what's happening in the outside world."

Gizmodo writer Sam Biddle describes hashtags as "one of the worst, toxic forms of internet pollution". But as they swamp us, their omnipresence has created a strangely beautiful and silly social-media vernacular, where someone might tweet about their dinner and add the hashtag #dinner, in the knowledge that no one would dream of actually clicking on #dinner – a tacit admission of the impotence of hashtags and the inconsequential nature of social media in general.

American Express recently trialled a method of buying products on Twitter via hashtags, but it seemed to be imposing functionality on a symbol that's become largely functionless. Indeed the ability of many Twitter clients to mute posts that contain particular hashtags has facilitated what might be the hashtag's biggest achievement: to allow us to completely ignore them.