Tuesday, December 18, 2007

Advertisers still don't know what surfers want

Online advertising jumped 25 percent this year, raking in a cool $20 billion, but Internet executives say that figure could have been even higher if advertisers had reliable and consistent ways to measure online audiences.

Unlike traditional media, where each format has one main ratings provider — The Nielsen Co. for television, Arbitron Inc. for radio and so on — there are many sources of data on online audiences. And they frequently conflict.

Disagreement also continues over which criteria best gauge users' potential interest in a product or service. And the resulting data aren't easily comparable to ratings in other media anyway.It's a "problem of plenty," as Manish Bhatia, president of global services for Nielsen Online, a unit of The Nielsen Co., told a recent conference on online audience measurement.

Web publishers are frustrated that the lack of cohesion is holding them back from capturing more of the $250-billion-a-year U.S. advertising pie, especially given the huge amount of time people spend online.

"This industry looks like it can't get out of its own way," said Steve Wadsworth, president of The Walt Disney Co.'s Internet group. "We need measurement of the audience and their use of the system that's clear, simple and actionable for a marketer. You need comparability with other media."

As Internet executives hash over clickstreams, page views and user panels, 2008 is sure to see even more evolution of the way online audiences are measured. Other media — including TV, radio and billboards — also are revamping the way they calculate ratings in response to pressure from advertisers trying to measure how effective their ad dollars are.

David Hallerman, senior analyst at research company eMarketer Inc., said many large advertisers remain shy of the Internet because of confusion over audience measures. Some also want to stick with video ads, which are still in their early stages on the Internet.

The Interactive Advertising Bureau, which represents more than 300 Web publishers, has called for Nielsen Online and comScore Media Metrix to undergo audits by the Media Rating Council, a process that is still under way. ComScore and Nielsen both still use panels, while Quantcast Corp., a relatively new agency, combines panel and Web-based data to produce ratings.


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