THE NET EFFECT: Does the net measure up? Lack of a universal standard in web measurement has stunted its growth. How far away is the industry from finding one size to fit all?

As internet usage in the UK climbs, advertisers know they have to

go online if they want to foster closer relationships with their

customers.



But the web is a completely different animal from TV and radio and, at

the moment, advertisers are still struggling to find ways to measure

accurately the effectiveness of campaigns.



"It's a fast-changing advertising medium. Whatever you think of it today

is pretty irrelevant to what it will be like in two or three years'

time," Frank Harrison, the strategic resources director at Zenith Media,

says.



At the moment, Harrison's thoughts about the internet are dominated by

the absence of detailed standardised measurements that would enable

advertisers to analyse fully the effects of web-based campaigns. "It

should be much more accountable," he says. "There is a lack of

standardised and industry-acceptable measurement techniques, which make

it extremely frustrating. We have three major audience measurement

panels, none of which provide the same data for the same sites for the

same period of time. It's difficult to plan ad campaigns and execute

them on the internet because of the lack of good data."



It's also frustrating for major portals because they want advertisers to

understand fully the scale of their achievement in attracting large

numbers, usually of ABC1s. "There is a need for all sides of the

industry: media owners, agencies and media buyers to agree on a single

way of measuring audiences," Harrison says.



While he accepts that some advertisers have had good online experiences,

there are large numbers who are yet to use the medium and he partly

blames the press for holding them back. "There is a lot of press comment

about advertising on the medium which suggests the banner is dead.

Banner advertising is the primary form of advertising on the web."



Banner ad impressions and clickthrough rates are currently the most

popular means of measurement for online advertisers. In fact, that

information is now pretty easy to access and the area where online

adland is focusing its attention now is on the degree to which people's

perceptions of a brand are affected by what they see online.



Work carried out by Engage already shows that clickthroughs are not

necessarily the most reliable measures of a successful campaign. In an

analysis of a banner ad campaign that it ran targeting business

travellers for Thistle Hotels, Engage found that one particular banner

ad was five times more effective in driving online hotel bookings. But,

significantly, it was the least effective in terms of generating

immediate clickthroughs. Engage argues that cases such as these clearly

illustrate the importance of measuring the total effect of an online ad

campaign including indirect responses.



Online consumers might not have clicked through to the advertised sites

immediately but tracking shows that people will return when they are in

a purchasing frame of mind.



Spending on online advertising in the UK is considerably less than it is

in the US, which could be partly related to the fact that measurement

systems over here are less well developed. "Between 1 and 2 per cent of

total advertising in the UK is being spent on the web per annum. That is

steadily increasing," Harrison points out. "In the US it's between 4 and

5 per cent. The net in the US has higher penetration and usage, so

measurement is more advanced than in the UK."



There are two key types of internet measurement systems in the UK. One

is panel-based, from the likes of Jupiter MMXI Europe. This provides

feedback on the online activities of representative samples of surfers

who have software put on their computers.



The other is site-centric, which analyses visitor data stored on servers

of individual web sites.



Harrison argues that UK panel-based internet data is incomplete because

at the moment it does not provide information on people using the

internet at work. "Arguably that is the hidden majority. There is a

substantial amount of internet usage out there that is not being

measured." He also wonders if people who volunteer to be part of a

panel-based service are that representative of the online population as

a whole.



John Purcell, the sales and marketing director of Nielsen NetRatings UK,

rejects the suggestion that panel-based research samples are currently

too small. "If we take BARB as a benchmark, I guarantee that a Nielsen

panel is of a similar scale, if not larger."



But what about the fact that there is no research done on people using

the internet at work? "Internet activity at work has been top of our

agenda for 2001 and continues to be. We have had an internet panel at

work in the US since last year. We launched one in Australia about three

months ago. We are just about to launch one in Italy and France and we

will have it here in December."



Taking into account the findings in the US and Australia, Purcell does

not think that audience numbers will shoot up when at work internet

activity is taken into account in the UK. But more time is generally

spent online at work. "In America it's about ten hours at home a month

and 22 hours a month at work."



Purcell believes there could be greater standardisation in the

future.



But for the time being he says it's up to the market to decide the best

measurement standard. "There are three panel-based research companies in

the UK and people are voting with their cheque books."



Advertisers also have criticisms of site-centric research carried out by

the likes of ABC//electronic, which analyses a site's log files.

Harrison feels the samples are too small and more detail is required.

Ideally, he would like to see more data about activity within individual

sections of websites, "so we have an understanding of where the traffic

is really going."



There is clearly enormous pressure on web-based media owners to

demonstrate the effectiveness of internet advertising. While existing

measurement systems have their critics, it's easy to forget that these

systems are likely to improve with time. Despite the grumbling about the

net's measurement systems, the medium is successfully attracting ABC1s

and has many unique attractions to advertisers.



Harrison says: "You can place ads that result in people buying products

shortly after being exposed to the ad. That is an enormous benefit. You

can do things on the internet in terms of building a presence within

internet sites. You can become a long term sponsor. And it offers highly

creative and innovative ways to communicate with consumers, which you

cannot do with any other media."



CARPHONE WAREHOUSE BOOSTS OFFLINE SALES VIA ONLINE



The big selling point for many online advertising campaigns is that they

offer advertisers and their agencies the ability to re-plan the campaign

and track its effectiveness while the ad is running live. This

accountability and flexibility makes online advertising distinct from

advertising on any other media.



The other factor to be considered is how much online advertising can

influence offline behaviour. For instance, for Carphone Warehouse's

online campaign, Yahoo! was able to show how online advertising affects

subsequent actions by using proprietary technology from Avenue A.



Carphone Warehouse wanted to challenge the myth that clickthrough rates

are synonymous with customer acquisition. The mobile phone retailer ran

a six-week campaign on Yahoo!'s UK and Ireland sites from 20 February

2001 to 1 April 2001.



The campaign was geared towards driving qualified traffic to

www.carphonewarehouse.com as well as increasing sales for the high

street retailer. Through Yahoo!



UK & Ireland's tracking technology, Yahoo! was able to track users'

behaviour, regardless of whether or not they clicked on Carphone

Warehouse ads.



Over the six-week period, the campaign reached 2,737,000 unique

users.



Some 92 per cent of all online sales produced by the campaign were

indirect; the remaining 8 per cent came via a clickthrough to the client

site. Spontaneous awareness among those exposed to the campaign grew by

45 per cent, demonstrating the internet's ability as an effective media

vehicle for brand marketers.



When it comes to what consumers recognise as brand attributes and how

internet advertising can reinforce them, the campaign also demonstrated

impressive results, particularly in terms of Carphone Warehouse's

extensive choice of products on sale. This in turn pushed up users'

intention to purchase by 33 per cent.



In terms of return on investment, this example demonstrates that online

advertising can provide a cost-effective method of targeting consumers

with brand messages through which brand attributes can be reinforced,

consumer behaviour can be tracked and sales can be generated.



ABC//ELECTRONIC: SITE-CENTRIC MEASUREMENT



ABC//electronic has placed itself at the forefront of attempting to

impose web-based research standards. Although the organisation

specialises in site-centric research, ABC//electronic's managing

director, Richard Foan, regards panel-based research and site-centric

research as complementary internet measurement systems, making a

comparison with offline media. "In print you have the National

Readership Survey and you also have ABC figures."



ABC//electronic offers any website a complete census analysis. So what

does that mean? "It's based on a complete analysis of all data," Foan

explains.



"The site itself is already collecting loads of data about where people

are going. There are many different solutions and the results they are

looking at might not be compatible to the results of another site. ABC//

electronic checks that the counting has been done to the industry agreed

standard."



Foan argues that ABC's methods are instilling confidence in web

advertisers.



"From an advertiser's perspective, it gives them a safety net. They can

trust the data." ABC//electronic's measurement system is run on an

opt-in basis. It's not compulsory and so far just under 200 companies

have registered accounting for thousands of web sites. Foan thinks the

take-up is good considering the company has been in existence for only

four years. "Companies have chosen us because it helps their business.

It is all about helping them to sell advertising," he says.



Dot Music is one of ABC// electronic's clients and the site has so far

had about eight audits. "It's about confidence," he says. "It

demonstrates that it is prepared to stand up and be counted. It can

actually measure the exact route someone takes through its site, which

pages they went to, in which order and how long they spent on one page

before going to another."



Foan believes that ABC//electronic's site-centric measures will grow if

the online marketplace sees its value. It costs about £900 for a

website audit but if you don't know your levels of traffic, Foan argues,

it is difficult to manage an online business. He points out that

independent data audits are also valuable for reporting back to

investors and believes that all sites should be audited twice a

year.



Some advertisers have argued that levels of traffic on a website can be

distorted by portals when they automatically refresh their own

pages.



ABC//electronic now separates that information out so a website owner's

activity on a page is not mistaken for the behaviour of consumers.



www.abce.co.uk



JUPITER MMXI: PANEL-BASED MEASUREMENT



Mari-Kim Coleman, the vice-president of Jupiter MMXI, argues that the

company's panel-based internet research provides a greater breadth of

information than site-centric methods.



"You can compare site versus site and the audience who goes to those

sites," she says.



One of the main criticisms that website owners and advertisers have of

panel-based research companies is that they still do not provide

measurement of people's internet activity at work. So when is Jupiter

going to introduce this service?



"We provide that in Australia, the US and Sweden. And we are building

work panels for all our major markets," she counters, but admits she

cannot put a date on when this service will be introduced into the UK,

although she hopes it will be later this year.



Looking at the findings of work-based internet research in countries

such as the US and Australia, Coleman says there are certain sectors of

interest on the web, such as sport and news, which have a strong pull in

the work environment and attract a lot of unique users.



Another charge levelled at panel-based research is that the samples are

limited and cover only the top sites. Coleman admits that panel-based

research can discriminate against unpopular sites. "If you are a niche

site and you do not have a strong following among the overall

population, you might not make it onto a panel." She adds that this is

where site-centric research can play a complementary role and dig deep

down into any individual site.



Does she accept that people who volunteer to be on internet research

panels are not likely to be representative of the population as a

whole?



"You could say that about any piece of research. This is a proven

traditional method. It's used for TV and print. With any piece of

research, you will have a certain element of bias that will be taken

into account."



She adds that the priority is to work with companies so that they

understand how the numbers work and how they can be applied.



YAHOO! UK & IRELAND LAUNCHES NEW MEASURING TOOL



Yahoo! UK & Ireland's new measurement tool shows actual audience

behaviour without relying on panel data. Its distinctive characteristic

is that it enables marketers to correlate the general "noise and

traffic" in a consumer's life versus marketing activity.



It will be integral in evaluating both online and offline activity as

well as the proximity of the buzz around a brand in relation to the

distribution of marketing spend.



It's also an effective way to track the latest interest and trends among

internet users. In its trial period, the product garnered an excellent

response from marketers. Like traditional evaluation methods, the new

measurement tool will monitor the impact of integrated marketing

campaigns.



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