While it had a strong Nov. 14th launch, Microsoft’s Zune has failed to maintain the momentum it created that week. Information Week reported Tuesday that Zune had 9% of unit sales and 13% of revenue during its launch week, but that it was still far behind iPod sales, which accounted for 63% of unit sales and 72.5% of revenue that same week. Zune also failed to touch the iPod on Amazon’s top sellers list - it rarely made the list at all this holiday season.

The buzz Zune created in the market has been largely around its potential to be the ‘iPod killer.’ Zune rarely earned exclusive coverage and has been evaluated, in most news articles, based on how it compares to the industry-standard iPod. This is typical for a new entrant to a market with such an entrenched leader, but it means that establishing its own identity will take time. The chart below shows only a small blip of exclusive coverage for Zune (not shared with the iPod) during its launch week.

Microsoft will have to change the public’s concept of a portable media player to beat the iPod in the long run. But, in the short term, it will first have to prove that it’s an equal substitute. This may be why Microsoft officials have said they are satisfied with initial results of Zune sales that seem to only scratch the surface of the market.

Beating the iPod also means that Microsoft will have to beat iTunes. MediaPost covered a Hitwise report today showing a 413% increase in iTunes store visits on Christmas Day. This represented a 110% percent increase over the previous year and placed iTunes fourth on the Hitwise retail index. Zune Marketplace was nowhere to be found. This is likely due to the relatively low amount of coverage it received compared to iTunes.

Does this mean that Zune and Zune Marketplace are destined to meet the fate of others who have tried to knock Apple off its digital music throne? Not necessarily. But it does suggest that if it happens, it won’t be a quick hit, but rather a slow etching away of its market share. All of the players in the space lose points in eyes of consumers for issues like digital rights management (DRM) that limit the way someone can access and share music. Until one provider develops a digital music solution that allows anytime, anywhere access to music on consumers’ terms, the playing field could still change.

For more analysis on Microsoft Zune, please click here to visit our Industry Reports section.

I attended the annual WOMMA Research Symposium
today in Washington D.C. and had the opportunity to listen to and talk with some of the leading thinkers on word of mouth marketing. What became clear over the course of the day is that there’s a lot of good research on how word of mouth (WOM) works and how to measure individual campaigns, but the industry is looking for more guidance on how to sell WOM to senior management to secure budget, how much budget to put toward WOM in an integrated campaign and how to compare WOM metrics and results to other marketing metrics.

Research from Ed Keller of the The Keller Fay Group reminded us that the majority of WOM is still happening offline (90% if I recall correctly). Still, there’s strong and growing demand to measure what’s happening online. This is partly due to how fast the channel is growing and partly because technology makes the job much easier than it’s been in the past. Forrester’s Peter Kim led a panel to discuss the reasons why. It included six of the seven vendors from his Brand Monitoring report - Maxine Friedman (Brandimensions), Max Kalehoff (BuzzMetrics), Howard Kaushansky (Umbria), Jim Nail (Cymfony), David Rabjohns (MotiveQuest) and myself.

While not everyone agreed on the importance of measuring traditional media to understand how word of mouth is generated (a position Biz360 supports), we all agreed that technology is an important enabler for making sense of social media - the millions of thoughts, ideas and creations posted to the Internet everyday. Human analysis remains an important component, however, for understanding the finer nuances of language (Biz360 uses machine-learning techniques that rely on regular human analysis and input to take technology as far as it will go). The session ended with vendor recommendations on what questions companies should ask themselves before investing in a brand monitoring solution. A few of the top questions were:

• What are my program goals?
• What resources do I have internally to support a monitoring/measurement program?
• What level of service (involvement) do I expect from the vendor?
• How confident am I in the vendor’s ability to deliver insight, not just data?
• How frequently do I need information and to what depth?

There were several great presentations over the course of the day. Jim Nail presented research on the word of mouth of cereal brands, which he confessed was not an exciting topic and didn’t generate a lot of content. What I found interesting though were the motivational categories he used to break out the WOM - health & wellness (Wheaties), parental (Cheerios), nostalgic (Count Chocula), etc. Biz360 conducted similar research on yogurt brands and also found a relatively low level of social media content (yogurt isn’t nearly as exciting as Paris Hilton or Nintendo Wii, so we weren’t surprised). What we did find was that the health-based messages appearing in social media were coming from the health & wellness publications. This is a good example of how traditional media can drive word of mouth. Companies looking for word-of-mouth influencers only among consumers are stopping short of their ultimate goal.

For the full list of today’s presentations, check out WOMMA’s Web site. I believe you can also order audio recordings of the presentations after the event.

If you haven’t read PRWeek’s annual measurement feature (reg req’d) by Erica Iacono, it’s worth checking out. She talks about the movement of PR toward embracing social media measurement and integrating it with traditional media measurement. She also emphasizes a growing understanding that market influencers could be journalists, analysts, bloggers or some combination of those things.The article also features a profile on Sun Microsystems, a Biz360 client. It outlines their integrated measurement strategy that includes domestic, global and social media analysis. This approach to understanding their market has lead to a change in the way they announce products:

Working with Biz360, the company has segmented the top 300 bloggers that it considers to be individuals that can ‘move the market.’ Sun tracks them on a monthly basis as far as what announcements they pick up and what issues are important to them.

This measurement strategy has impacted the company’s outreach to the community. When it came time to announce the launch of Solaris, a new operating system on the Open Source platform, the PR team made the decision to launch it into the blogosphere first.

Erica also references the biggest measurement story from last year, which focused on how P&G had discovered through market mix modeling (MMM) that PR had the highest ROI among the marketing disciplines in four out of the six brands it tested. David Rockland of Ketchum predicts that MMM will soon be the standard for measuring “quick sale, non-durable consumer goods.”

With increasingly sophisticated measurement and budgets on the rise, I think we’ll be hearing more about placing PR results in a larger business context.

This past Friday, I participated on a panel with Jim Nail of Cymfony at Bulldog Reporter’s Advanced PR Technology in Practice conference in San Francisco. The subject of the panel was online measurement and was moderated by Eric Schwartzman of iPressroom. There were two overarching themes that came out of our presentations and Q&A. The first is that the movement of content online, the expansion of social media and the development of free and premium services for tracking all this new content make it possible to measure much more than you could just a few years ago - and get the results fast.

The second is that there is now more reason than ever for PR measurement to be placed in a business relevant context. That could be correlating results with internal marketing data, such as Web traffic or lead generation. Jim suggested that internal PR leaders get to know the folks doing marketing mix modeling (he referenced a PRWeek story - reg req’d - about P&G using market mix modeling to determine that the ROI from PR was higher than other types of marketing for four out of the six brands tested). It could also be correlating PR with changes in public perception using social media as a proxy. The ability to change opinions and behavior has always been the promise of PR. Measuring that change usually required surveys, focus groups or Web site data (how did you hear about us?). Social media changes the game by allowing PR to quickly assess public sentiment broadly or compare the buzz of individual news articles in the market.

There were many other notable sessions that day, athough I wasn’t able to attend them all, so I’m just going to note a few things that stood out for me. Dan Gilmor provided an overview of how citizen media is changing journalism and how the public consumes information. He even addressed the folly of citizen media, citing an example of a photo-shopped image of a man standing against the rail of one of the twin towers with an airplane in the background heading toward it.

Jamie O’Donnell of SEO-PR actually convinced me that the press release is not dead. At Biz360, we talk about how the rise of social media has made it possible to take your message directly to your target audiences. Jamie talked about how press releases, properly optimized for search, often rank above actual news stories on Google News and that you can take your message directly to the public in this way. His advice is to use Google Trends to figure out the top relevant search terms for your press release, use those terms in the headline and first paragraph and include hyperlinks throughout the body to drive users to your Web site (let me know if any of this works).

So if the press release isn’t dead, it’s definitely changing. Brian Solis of FutureWorks PR talked about how to write a social media press release that includes includes social bookmarks from del.icio.us, photos from Flickr and other Web 2.0 goodies. Naturally, at throughout the day, attendees asked if companies would eventually ruin social media. I expect this to be a topic at the upcoming WOMMA Summit.

If you’re interested in learning more about the topics here, Eric Schwartzman’s post includes links to all of the presentations, including mine. He also set up a del.icio.us page where the speakers could share links to supporting materials.