It's the software, stupid...

Or wait -- is it the touchscreen interface? The feature set? Or is it just the absence of a totally confusing mix of buttons, scroll and push wheels, and disparate applications... Whatever the reason, the iPhone has the highest customer satisfaction -- 82% of users are "highly satisfied," versus 51% for the BlackBerry, next highest in the latest ChangeWave user poll.

After 18 months with a BlackBerry 7130C, I'm not surprised. I'm still struggling with the integration of the phone UI and function with the "smart" stuff that supposedly makes it a smartphone.

Let's see how this upcoming generation of iPhone clones fares -- and hope the handset manufacturers really get what it is that makes the iPhone experience not just a cool one -- but a deeply satisfying one.

Mobile advertising still a learning process

eMarketer reveals numbers from a recent Harris Interactive survey.  Mobile users show strong preferences for what kind of mobile advertising they find acceptable. Sponsored text links scored the highest followed by automotive audio ads that play while someone is waiting for a caller to pick up.

User action for ads shows only 10% took action based on a mobile ad while 70% deleted ads altogether.

With mobile ad spending expected to reach $5 billion in 2011 there is a long way to go for marketers to learn how to best achieve desired results.

"After a lot of hand-wringing and some spectacular successes — as well as flameouts — mobile operators, brands and consumers will learn from each other about what works and what does not work, just like they did for online," eMarketer Senior Analyst John Gauntt predicted.

Rethinking expert influence

Ad Age Digital references a new CNET study revealed at ARF yesterday, which seems to contradict much of what has become traditional dogma about the impact of influencers. Ted Smith, research fellow at CNET Networks, presented the results of  a study that suggests that rather than a small group of hyper-connected, influential individuals driving a majority of recommendations, closer to 85% or 90% of the population has significant potential to influence -- people who are "...not necessarily experts but are reasonably good at figuring out the information that can help friends and family."

We've seen this in our own research as well, depending on the category and consumer purchase process. For example, for one of the world's largest ISP/online services, we found that when a consumer was in-market for a new ISP, an influencer was as close as the person next to you. In other categories, or at certain points in the product lifecycle, influencers matter more. As in most things, it's relative.

In thinking about how to use these findings, we think it's critical that marketers start with a clear understanding of the purchase model -- how, exactly, consumers purchase your product, including their purchase triggers, influences on awareness, consideration and active consideration, use of media by purchase process stage, etc. It's staggering the number of companies that don't have an accepted, shared baseline for their purchase process -- and even fewer do additional purchase process research to keep it updated on an annual basis.

MySpace not a popular shopping site: shocker!

The other day iProspect and Jupiter released the results of a new Social Networking User Behavior study. It seems that interviews with users of social media have found that users search social media sites to connect with friends, search reviews on Amazon when they want to buy stuff, and search YouTube when they are looking for entertainment. Oh, and social content on Amazon (reviews) are a lot more likely to influence purchase behavior than social content on MySpace or Facebook.

At the risk of sounding just a bit snarky, duh! Now that I have that out of my system -- this is why social networking and media consumption and sharing sites present marketers with opportunities to do things other than present product reviews and click to buy messaging -- for instance, branding. But even when you want to do that, just remember where your brand fits in the user's view of the media environment they have chosen to inhabit at that time. Market to the mindset, not just the medium.

Did we really need another survey to tell us this?

Online video ads more effective than TV ads

A recent study by Millward Brown points to some surprising results: online video ads are more effective for brand awareness and recall than TV ads. Reasons include a less cluttered ad space and more attentive users.

ClickZ reports, "The study compared reactions of viewers to 30-second ads shown during network shows viewed on television, DVR and online. While TV and DVR viewing resulted in 54 percent brand awareness among the ad watchers, the survey found online viewing led to 82 percent brand awareness.

Ads placed online drove even higher brand recall: 18 and 19 percent for TV and DVR viewing, respectively, versus 77 percent for online viewing. In addition, while around 70 percent of TV and DVR ad viewers linked the correct brand to a commercial, 93 percent did so if they watched the ads online."

Mark Loughney, vice president, sales strategy & research, ABC commented, "The results of the Millward Brown CTV1 Study provide independent confirmation of our own research that we have been sharing with our advertisers on ABC.com. Sole sponsorship of programs in the "leanforward" online environment provides an opportunity for our partners to connect with passionate fans of ABC shows in a uniquely engaging environment."

"The State of the Console"...staggering

Nielsen's first study of the console industry is going to turn some heads. Lost Remote says, "the report clearly shows that much of the usage is taking place when people would normally be watching conventional TV programming."

Media Post says, "the study suggests that while Madison Avenue has become transfixed by other digital media, especially online, DVRs, and personal media devices such as the iPod, video games already are having a profound impact on the way people spend time watching TV for a very simple reason: Most video game consoles are connected to the primary or secondary TV set in TV households, and they are used primarily during traditionally peak TV usage time periods - especially among some of the most important and elusive TV audience demographics."

Key Takeaways:

• The console household universe has grown 18.5% sine fourth quarter 2004, compared to a 1.6% growth in the total universe of television households.
• Two-thirds of all Men aged 18-34 have access to a video game console in their home.
• The universe of connected console households (households subscribing to a service to connect their console to the internet) has grown to more then 4.4 million households, even before the newest Playstation 3 and Wii consoles are considered.
• In the NTI (Nielsen Television Index) fourth quarter of 2006, 93.8 million US Persons aged two and older used a video game console for at least one minute.
• In any given minute, approximately 1.6 million US Persons ages two and older are using a video game console.
• The heaviest console users accounted for 74.4% of all console usage and averages 345 minutes (5 hours and 45 minutes) of usage per day during the fourth quarter.

In-game advertising is going to really take off as more people get internet connectivity for their consoles. It also makes Microsoft's purchase of Massive seem pretty smart.

Newspapers beat TV stations for online video revenue

A new report from Borrell Associates indicates that local newspapers are beating local TV stations for online video advertising revenue. The report shows that in 2006 newspapers sold approximately $81 million in local online video commercials in comparison to $32 million sold by TV broadcasters.

Lost Remote comments, "Portals (and other pure plays), network/cable sites, newspapers and even video blogs are beating local TV sites in video innovation and revenue generation. How important is video? Borrell goes on to predict that video advertising will skyrocket to make up one-third of all local online advertising in 2012, just below paid search."

From the report: "The most exciting thing I’ve seen in the numbers is the consumer demand for advertising, which pales in comparison to consumer demand for local news. In the end, the local media company that wins is one that can deliver a wealth of interactive content — especially video — around consumer verticals like real estate, health, automotive and other high-priced items that require lots of prior research."

Long form local video will find its audience as more people look online for deeper information than a 30 second ad or a 15 second pre-roll. No matter what the media outlet is, local is going to be the new black.

The hype is real: social networks

UMass Dartmouth's Center for Marketing Research released a report (PDF) recently that details the opinions of Inc. 500 companies on Social Media. The conclusion: "The hype is real."

The report is based on interviews with 121 Inc. 500 companies who were asked detailed questions about their usage and measurement of social media. 42% claimed to be "very familiar" with social networking.

33% of responders said that their company uses forums as a marketing tool while only 17% used wikis and 11% used podcasting.

Looking forward, 26% saw social networks as very important to their marketing strategy with 40% saying it was somewhat important.

The study concludes, "from familiarity to usage to importance, social media is far more prevalent in the Inc. 500 than previous research would predict."

IAB Internet Advertising over $4B for Q3

The IAB released a report today showing internet advertising spending for the 3Q of 2006 will exceed 4 billion dollars.

From the press release:

"The consistent growth of online advertising is a clear indication that marketers continue to embrace the true power of interactive advertising," said Sheryl Draizen, SVP, General Manager, IAB. "Marketers are experiencing how this medium enhances their ability to target and engage the audience that matters to their brand and then measure its effectiveness in ways no other medium provides."

"Interactive advertising, with its eighth consecutive quarter of growth and the largest single quarter ever, is on pace for its biggest year. This growth follows the trend of where consumers are spending their media time and the unique ability of Interactive advertising to effectively target and monitor ad campaigns," said David Silverman, Partner, Assurance, PricewaterhouseCoopers.

IBM to invest $10m in 2007 on Second Life

The news broke Friday that IBM will invest $10 million in 2007 on Second Life projects. IBM Chairman and chief executive Sam Palmisano will address 7000 IBM employees in a town hall meeting tomorrow and then visit IBM's Second Life projects in-world.

IBM has been working in Second Life of over a year on its secret island and has 250 employees that regularly use Second Life to conduct meetings and seminars.

Irving Wladawsky-Beger, VP, Technical Strategy and Innovation at the IBM Corporation, stated Friday, "The essence of ecommerce today is built around the idea of catalogues. That's very useful, it fits with the idea of web pages and catalogue pages but most people don't think of shopping in terms of catalogues and pages but in terms of stores that they go into."

Led by IBM Second Lifers, Roo Reynolds and Ian Hughes, IBM plans to develop a v-Business strategy that includes thinking about getting data in and out of Second Life.

Coming on the heels of the CNN/Fortune article titled, "No, Second Life is not over hyped," the IBM announcement lends credence to the fact that Second Life may be more than what it currently appears to be.

(Second Life photos by Michel Leblanc)