Saturday, March 26, 2011

Is This Ad Spending Recovery for Real?

Upbeat mood helps twitter following. Social media usage drives mobile device satisfaction, but declining call quality and proposed AT&T merger could be fly in mobile growth ointment.

Yesterday’s revised numbers from the U.S. Commerce Department indicated the economy is growing at a faster—i.e. less anemic rate—than previously believed. Government GNP prognosticators Friday upped their estimate of Q4 economic growth to an annualized rate of 3.1 percent from a 2.8 percent estimate issued last month.

On the media side, a just-released report from Kantar Media said total advertising expenditures increased 6.5 percent in 2010, buoyed by a strong fourth quarter and a big push from small advertisers outside the Top 1000. Internet display advertising increased 9.9 percent over 2009, cable TV rose 9.8 percent and network TV spending surged 5.3 percent. Expenditures in consumer magazines were up 3.3 percent, but B2B magazines dropped another 1.2 percent, and local newspapers sank 4.6 percent—its 21st consecutive quarterly decline.

Our take? Consumer, businesses and lenders have become less pessimistic about homes and jobs. TV, mobile and the Internet will continue to thrive this year—we expect double digit gains. If we can find any cheer on the print side, it is that ad pages in the Finance category were up 9.3 percent according to year-end 2010 PIB numbers and ad pages from Technology sponsors were up 2.3 percent. Tech and finance are two of the most important, and most cyclical, sectors for many of our clients and we expect to see more long-form thought leadership campaigns in 2011, not the direct response or mass branding campaigns that have dragged down other print categories.

Upbeat mood helps Twitter following

A new Indiana University research paper says that people who use Twitter congregate online according to their mood, not just by age or similar interests. For example, the research, found that people who send Twitter messages that include the word “loneliness” also tend to flock together on Twitter. To understand how mood plays a role in the camaraderie of people on social networks, researchers monitored 102,009 active Twitter users for six months. The researchers then applied a psychology theory, “subjective well-being,” to each message to understand its mood. The results found that people who are happier on the social network tend to re-tweet or reply to others who are happy, too. The same results were found with those who were unhappy.

The researchers summarized that “online social networks may be equally subject to the social mechanisms” that govern the real world, where real-life interaction can revolve around mood and feeling, too.

Active mobile users are active online searchers

According to the NEW BIGresearch Simultaneous Media Usage Survey, mobile users who actively search for information, such as news, sports and TV/videos, are more likely than general consumers to conduct regular product research online. When it comes to searching for financial information and services, active mobile users are nearly twice as likely as general consumers to conduct regular product research on online. When it comes to sharing online research findings, nearly 97 percent of all active mobile users say they give advice about products and services, and word of mouth (face-to-face) is the most prominent means.

Cell phone service quality continues to disappoint

If it seems you’re losing more calls than usual on your mobile phone these days you’re not alone. On top of the proposed AT&T / T-Mobile merger which could eliminate choice and advantageous competitive pricing for consumers, the quality of wireless phone calls has hit a plateau, according to J.D. Power and Associates. According to Power, one major driver is the increasing number of cellphone calls placed or answered indoors, as people use their cellphones to replace or supplement landlines. Indoor calls tend to be fuzzier than outdoor calls, because the signal must penetrate walls and windows to reach the tower. Regardless of where the calls were made, J.D. Power said the quality on all handsets — both smartphones and traditional cellphones — seemed to have worsened over the last six months, with smartphones eliciting more complaints than traditional handsets.

But last week, overall satisfaction with smartphones and traditional mobile phones is considerably higher among owners who use their devices for social media activity, compared with satisfaction among owners who do not access social media platforms on their phones, according to the J.D. Power and Associates 2011 U.S. Wireless Smartphone Customer Satisfaction Study.

Among smartphone owners who use their device to access social media sites such as Twitter, LinkedIn and Facebook, satisfaction averages 783 on a 1,000-point scale—nearly 22 points higher than among those smartphone owners who do not often use social media sites on their device. Currently, more than one-half of smartphone owners report having used their device to access social media sites via the mobile Web or mobile applications. While rates of mobile social media site usage are not nearly as high among owners of traditional mobile phones (9%, on average), satisfaction among traditional handset owners who use their device for social media is notably higher than that of traditional handset owners who don’t access social media (754 vs. 696).

“It’s not unexpected that smartphone owners access social media sites from their device more frequently than traditional mobile phone owners due to features such as larger screens and QWERTY keyboards,” said Kirk Parsons, senior director of wireless services at J.D. Power and Associates in a news release. “However, these findings demonstrate that equipping devices with powerful features and service is key to creating positive customer experiences with wireless devices.”

For a fifth consecutive time, Apple ranks highest among manufacturers of smartphones in customer satisfaction with a score of 795 and performs particularly well in ease of operation, operating system, features and physical design. Motorola (763) and HTC (762) follow Apple in the smartphone rankings. Sanyo ranks highest in overall wireless customer satisfaction with traditional handsets with a score of 715. Sanyo performs well in three factors: physical design, battery functionality and operation. LG (711) and Samsung (703) follow Sanyo in the traditional handset rankings.

Once again, innovation and dedication to customer service carry the day. Customers are better armed than ever before to share their experiences with the masses. Thanks to mobile technology, social networking and the web, the strong players—with a disproportionate share of happy customers happily sharing their stories--will further distance themselves from the laggards.


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