Wed, Oct 24, 2007 page9

• Measuring the visitors at Web sites can be a nefarious science

  The number of visits a Web site receives is crucial to setting advertising rates, but varies wildly depending on who's counting and how they go about it

  • By Louise Story / NY TIMES NEWS SERVICE
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  How many people visited Style.com, the online home of Vogue and W magazines, last month? Was it 421,000 or, more optimistically, 497,000? Or was the real number more than three times higher, perhaps 1.8 million?

  The answer -- which may be any, or none, of the above -- is a critical one for Conde Nast, which owns the site, and for companies like Ralph Lauren, which pay to advertise there.

  Conde Nast's internal count (1.8 million) was much higher than the tally by ComScore (421,000) or Nielsen/NetRatings (497,000), whose numbers are used to help set advertising rates, and the discrepancies have created a good deal of friction.

  Other big media companies -- including Time Warner, the Financial Times and the New York Times -- are equally frustrated that their counts of Web visitors keep coming in vastly higher than tallies that are made by tracking companies.

  There are many reasons for the differences -- such as how people who use the Web at home and at the office are counted -- but the upshot is the same: The growth of online advertising is being stunted, industry executives say, because nobody can get the basic visitor counts straight.

  "You're hearing measurement as one of the reasons that buyers are not moving even more money online," said Wenda Harris Millard, president for media at Martha Stewart Living Omnimedia and, until June, the chief sales officer at Yahoo.

  "It's hugely frustrating. It's one of the barriers preventing us from really moving forward," she said.

  Online advertising is expected to generate revenues of more than US$20 billion this year, more than double the US$9.6 billion it represented as recently as 2004.

  Nobody doubts that the figure will grow -- particularly as advertisers hone their techniques for aiming messages to particular consumers -- but the question remains how much the clashing traffic figures will hold the market back.

  Jim Spanfeller, president and chief executive of Forbes.com. said: "This is a bit of an anomaly because this disagreement doesn't happen offline."

  By his calculation, Forbes.com had 11.6 million US visitors last month, far more than the 7.5 million estimated by Nielsen/NetRatings and 5.8 million from ComScore.

  Of course, media companies have haggled with advertisers over audience numbers for decades. Television broadcasters cannot prove how many people watch their shows. Print outlets have circulation numbers, but those do not capture multiple readers of each copy. So media companies have needed firms like Nielsen to provide panel-based estimates.

  But the Internet has given publishers a new form of ammunition: raw server data with precise numbers of site visits and page views. These data do not correlate directly to the number of visitors, but they do give them ballpark figures that publishers say are far more accurate than the extrapolations drawn by ratings companies based on panel samplings.

  But far from solving the squishy-numbers problem, the Internet seems to have added more confusion. Many advertisers pay Web publishers each time their ad gets an impression, meaning that it is viewed by a reader, but each company uses its own methodology to count impressions.

  "One of them can be right, or the other one is right, but they can't all be right," said Jack Wakshlag, chief research officer at Turner Broadcasting System. "It's interesting that people keep talking about it as much more accountable than other media, but we're not finding that to be the case yet because there's no agreement on metrics or accounting methods."

  To make matters worse, two agencies that buy huge amounts of ads -- Starcom MediaVest Group and the MindShare unit of Group M, part of WPP -- threatened major Web sites last spring that they would slow the money flow if the Web publishers did not get working on the discrepancies.

  Advertisers are concerned not only about how many people visit sites, but also how often their ads appear.

  Media companies do track the number of times that ads appear on their Web sites, but so do ad delivery companies like Atlas, which was recently acquired by Microsoft, and DoubleClick, which will become part of Google if the Federal Trade Commission approves a merger.

  Again, those sets of numbers often dance to different tunes.

  "If it's 5 percent apart on a large campaign of US$2 million or US$3 million, then we're talking about meaningful money," said John Montgomery, chief executive of MindShare Interaction.

  problems counting

  A main source of the discrepancies is over how to measure Internet use in the workplace. Nielsen/NetRatings and ComScore both track the Web use of representative panels of people, and use those traffic patterns to extrapolate the total number of visitors to a Web site.

  But online publishers say that the systems they use drastically undercount people who use the Web during work hours, particularly in offices where corporate software makes the wanderings invisible to the tracking systems.

  The issue is most pronounced at sites like CNN.com and Forbes.com, which say that high numbers of people read them in the workplace.

  Spanfeller says the ratings companies' figures at times have "no relationship to reality"; they in turn say that executives like Spanfeller are simply deceiving themselves about the popularity of their sites.

  "It's in their interest to make their audience look as big as possible," said Gian Fulgoni, chairman of ComScore.

  Manish Bhatia, executive vice president for global operations and US sales for Nielsen/NetRatings, agreed.

  "If the panel numbers were higher, I don't think you'd be having this debate," he said. "People would love us."

  Asked if Web publishers are just unhappy that the facts do not align with their goals, Scott McDonald, senior vice president for market research at Conde Nast, said: "There's probably some truth in that. Everyone likes bigger numbers."

  But, he said, the ratings panels still have problems.

  Conde Nast met with ComScore late last year to dispute the figures for Style.com.

  "They couldn't really explain it, and they admitted as much," he said.

  ComScore did not respond to a request for comment.

  Conde Nast counts international readers and ComScore and Nielsen/NetRatings do not, but that does not fully explain the discrepancies, McDonald said.

  He finds fault with the panels that both companies use, saying that they do not include enough of the wealthier people whom Conde Nast says frequent many of its sites.

  Complaints about the panels do not end there. Some Web publishers say the panels lack representation from students on college campuses, Hispanics and other demographic groups.

  `natural bias'

  "The results you get from a panel will reflect the choices you've made as you select the panel," said Rob Grimshaw, advertising strategy director at the Financial Times. "There's a natural bias from panels. And on the Internet, we can have a genuinely more accurate system."

  Media executives also chafe because some organizations are allowed to include groups of sites as a single entry for ratings purposes.

  Publishers that compete with Time Warner, for instance, call it unfair that CNN's outside rating includes the sites CNNMoney, Fortune, Time, CNN, Sports Illustrated and Golf.

  ComScore and NetRatings are cooperating with audits by the Media Rating Council, a nonprofit organization that has approved ratings systems since the 1960s. Among other issues, the council is investigating whether the companies' panels represent all Web users.

  The ratings companies say they have improved their panels, and point fingers back at the Web publishers, accusing them of mixing international and domestic traffic and of double-counting people who visit a site from home and from the office.

  To make matters more complicated, consumers who delete cookies -- small bits of computer code that track their online wanderings -- are also overcounted by publishers' servers, by most accounts. Some news sites have tried to improve their systems by asking their visitors to register, but many people refuse.

  "The irony is we've always called for more measurement," said Stephen Kim, director for global trade marketing at Microsoft Digital Advertising Solutions. "Now we're getting it, but many people are somewhat frozen in how to deal with having more measurement."
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