Site to Streamline How Web Traffic Is Measured

Some of the most popular sites on the Internet are planning to reveal more detailed information about the traffic they generate in a bid to improve advertiser confidence in the medium.

Starting next month, Yahoo Inc. and dozens of other big Web companies are expected to allow audited reports of their own internal traffic figures to be posted on a Web site that will be available to advertisers and the public.

Experts said the step could help eliminate a lot of the confusion and warring numbers that surround Web traffic estimates, the all-important numbers that determine how much advertisers are billed.

As things stand now, some Web sites use unaudited figures, which are often inflated. Even those who use auditors sometimes do not disclose the results. And the auditors themselves often have different methods for counting visitors.

The new site, Audit Central, will make sure the auditors use the same guidelines, and the published reports will allow advertisers and investors to make more useful comparisons.

The effort “will be crucial for online advertising,” said advertising analyst Christopher Todd of Jupiter Communications. “You’re going to see more traditional advertisers coming online, and issues such as measurement will be a key component of that.”

The new site will be run jointly by ABC Interactive, BPA International and I/Pro. Few Internet users have heard of these companies, but most major sites rely on them to lend credibility by verifying the sites’ own internal traffic measurements.

Backed by advertisers and their agencies, which are projected to spend $5 billion this year on the Web, the auditors are urging their clients to publish audit results on the new site.

“It’s not the answer to everything, but you can feel that you can trust the estimates that the sites are giving you,” said Gerard Broussard, an ad agency executive at Ogilvy One who pushed for the new standards.

The three auditing companies have often sniped at one another’s methodology, and their competing approaches have sometimes made it difficult for advertisers to compare metrics from one site to another.

But the three recently hammered out agreements on a number of standards. For example, the companies agreed that when an Internet user views a Web page that has multiple on-screen components, it should count as only a single page view.

The new standards could increase the significance attached to audited information from Web companies, as opposed to the outside ratings estimates provided by such firms as Media Metrix and Nielsen NetRatings.

Measurements by the auditing firms are based on internal records from the Web companies. The rating firms, by contrast, emulate television rating services. They give out software to thousands of users and then track where they travel in cyberspace.

Many sites have complained that those outside estimates are conflicting, opaque or inaccurate, commonly underestimating the number of visitors. A sweeping study released last month led by search portal Yahoo, with all parties cooperating, found that outside ratings services could be wildly off base, reporting as little as 15% of a site’s real traffic or overestimating traffic by as much as 300%.

Media Metrix and Nielsen point out that they provide valuable demographic information prized by advertisers. They also say their sampling techniques have improved.

The Web sites’ internal figures, from logs kept on their computer servers, are used to show how many browsers viewed a specific page or ad. Those numbers have drawbacks as well and are commonly exaggerated by the inclusion of hits from search engines, internal traffic and other factors.

Although some of the methodological disputes can be arcane, different traffic figures can have a dramatic effect on a company’s fortunes.

AltaVista Co. delayed its initial public offering after its search engine fell in the rankings for the most popular sites, and the stock prices of other companies routinely rise and fall on their ratings.

Some major Net company acquisitions also have been driven mainly by the desire for higher traffic figures, such as Excite@Home’s $970-million purchase of a popular but ad-free electronic greeting card site run by Blue Mountain Arts.

But even figures from rival ratings services disagree, leading Net companies to tout whichever ranks them higher.

“We will try and look at what makes our company look better,” said investor relations chief Larry Wahl of SportsLine.com, which has trumpeted ratings from both Media Metrix and Nielsen.

Advertising on the Web hit $2 billion in the first quarter of this year, according to the Internet Advertising Bureau, up less than 10% from the previous quarter.

And Rich LeFurgy, the trade group’s chairman, has said that “lack of reliable measurement is the No. 1 reason why media buyers do not buy on the Internet.”

Auditors and agencies said the new site will help prove that the ads are reaching their targets.

“The agencies are getting pressed to show a return on investment for their clients,” said Patrick Monahan, senior vice president at BPA International. “The more the standards can be settled, the easier it will be.”