Net advertisers system fails to measure up

The internet advertising industry has blundered badly by opting for a monthly reporting system for its new audience measurement regime.

The Australian, Thursday 6 December 2007
By Simon Canning

Last week the Cross-Industry Online Measurement Committee announced it would seek a panel-based system after years of the advertising industry calling for a single measurement currency.

But the decision to report data every month has rendered the incoming system as relevant as the old diary method of measuring television audiences.

Internet measurement experts have questioned the decision, saying the monthly reports would be irrelevant even before they were published.

Internet advertising purveyors have long trumpeted that theirs is the most measurable medium of all, capable of assessing in an instant the efficacy of a campaign.

Both the radio and newspaper industries are in the midst of reassessing their measurement system, while since TV moved to electronic panels in the 1990s, data has been available to the networks on a minute-by-minute basis and ratings are widely reported the next day.

With online advertising crashing through the $1.4 billion barrier, advertisers have been demanding some clear identification of the effects of their investments.
While there is little doubt the establishment of any common measurement system is welcome, it seems astonishing that in 2008 advertisers will have to wait a month to find out the impact of their advertising.

Even pizza chain Domino's, with 470 or so stores, is able to centrally measure sales at every store every 30 seconds, yet it is a challenge that the internet industry appears to have failed to conquer.

The measurement committee said that a key factor behind the decision to report on monthly basis was the ability to access demographic information about internet users.

Peter Hunter, general manager of consumer relationship company Touchpoint, which creates and measures campaigns, said while there would always be debate about methodology, it was hard to grasp why there would not be more immediate reporting.

"To measure on the basis of a monthly panel seems a far leap from what we deliver to our clients," Mr Hunter said.

"We have campaigns that within 24 hours of them launching are altering immediately and we have metrics to work out why we should do that, and as an industry we should see that it maybe consolidates monthly but at least reports simple trends daily.

"What has come out of the process is something that doesn't deliver to the core proposition of what this medium is: instantaneous consumer gratification. People want what they want when they want it, and that is what we all sell this medium to be."

Thus far advertisers have called it encouraging but there is little doubt that once the panels begin operating early next year, there will quickly be a groundswell of support to increase the reporting frequency.

"A big part of what clients expect is accountability and they want it now," Mr Hunter said. "They want to know as soon as something has gone live if they have made the right decision."

The internet industry may be opting for a system with the speed of a snail in the lightning-fast era of modern communications, but don't be surprised if by the month becomes by the minute when the system is fully implemented.