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 Condé Nast, which owns the site, and for companies like Ralph Lauren, which pay to advertise there. Condé 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 those of the 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, chief sales officer at Yahoo. “It’s hugely frustrating. It’s one of the barriers preventing us from really moving forward.”
Online advertising is expected to generate more than $20 billion in revenue this year, more than double the $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.
“This is a bit of an anomaly because this disagreement doesn’t happen offline,” said Jim Spanfeller, president and chief executive of Forbes.com. By his calculation, Forbes.com had 11.6 million United States 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 companies 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. This data does not correlate directly to the number of visitors, but it does give them ballpark figures that they 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 worst, 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 advertisements 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 $2 million or $3 million, then we’re talking about meaningful money,” John Montgomery, chief executive of MindShare Interaction.
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 their systems 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. Mr. Spanfeller of Forbes.com says the ratings companies’ figures at times have “no relationship to reality”; they in turn say that executives like Mr. 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 M. Fulgoni, chairman of ComScore.
Manish Bhatia, executive vice president of global operations and U.S. 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 Condé Nast, said, “there’s probably some truth in that. Everyone likes bigger numbers.”
But, he said, the ratings panels still have problems. Condé 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.
Condé Nast counts international readers and ComScore and Neilsen/NetRatings do not, but that does not fully explain the discrepancies, Mr. McDonald said. He finds fault with the panels that both companies use, saying that they do not include enough of the wealthier people whom Condé 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.
“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 that 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.
Both 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 actually represent all Web users.
The ratings company 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. ComScore pointed to cookie deletion as the source of the difference between its figures for Style.com and Conde Nast's figures. 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.”
