I use an app called VIPorbit on my iPhone. I have the VIPorbit app on my iPad as well even though it is an iPhone app. Like the Google+ Circles paradigm, VIPorbit takes the approach of setting up contacts in one or more "orbits". For example, I have orbits for "Family", "Friends", and "PCWorld" (among others). If a member of my family also worked with PCWorld, they could be placed into both orbits simultaneously.
The VIPorbit contact information includes the standard photo, phone number, and email address, but it offers a little more. VIPorbit was developed by one of the co-creators of the popular ACT! contact database software for the PC, and it brings that same level of relationship management to iOS.
VIPorbit has fields for Facebook, Twitter, and Skype info for your contacts, and you can initiate phone calls, emails, SMS text messages, Facebook updates, Skype calls, or Twitter tweets to a given contact directly from within VIPorbit. VIPorbit also maintains a calendar, and logs activity (calls, meetings, action items, etc.) related to a contact.
I am choosing to invest my time building my contact database within VIPorbit because I appreciate how the app enables me to stay in touch, and stay on top of events all from one place. I am not happy about using an iPhone app on the iPad--I have already mentioned I am not a fan of the iPhone-sized app in the middle of the iPad display, nor am I a fan of expanding the app to fit the iPad display and having crappy, pixelated images. The good news is that an iPad version is in the works.
One area where the iOS Contacts app has VIPorbit beat is syncing. While it does require using a PC as intermediary, my contacts are the same on my iPhone, iPad, and PC because they are all syncing the same data. When iOS 5 and iCloud hit the street in a few months, this syncing will be done automatically over the air. VIPorbit doesn't currently sync data between different devices, but an upcoming release is expected to resolve that so that my iPhone and iPad VIPorbit apps are on the same page.
It is a tough call for me. The Contacts app accomplishes most of what I need on a day to day basis in terms of a basic address book. It also has the advantage of being an iPad app, and being integrated into other aspects of iOS, as well as being able to sync contacts wirelessly using Exchange Active Sync. But, when it comes to managing my business, and using the iPad as computing platform for productivity, I prefer the functionality of VIPorbit.
The thing with managing contacts is that you quickly become invested in whichever tool you choose. Adding the details that make the contact manager more valuable is a tedious task. I have yet to come across a tool that can seamlessly import all of those details from another platform, so switching is an equally thankless job.
Choose wisely, because you won't want to change your mind later. It takes a lot of work to get your contacts set up and all of the details entered, and it's not something you want to do twice if it can be avoided.