Industry Still Doesn’t Have Handle on Counting Traffic

The Internet was supposed to be the most measurable medium, with each user leaving an electronic fingerprint on every visited page.

Instead, it’s turning out to be a real mess.

The problem is that every site seems to have a different idea about the best means of measuring traffic. Is it “hits” or “unique visitors” or “impressions” or what? So far, there is no standard.

“We get a tremendous amount of data per week, and the trick is reducing it to a format where we can understand it in a statistical sense,” said Dean Wallraff, chief executive of Hyperdrive.com, a site selling educational and entertainment software. “But then, it’s an art at that point of trying different things and seeing what happens.”

Many popular measuring methods, such as visitors and hits, may not tell business owners much about how their companies are faring.

“Using hits and page views to judge success is like evaluating a music performance by its volume,” said Harley Manning, a research director at Forrester Research.

‘Hits’ are misleading

Though the name implies a visit to a Web site, a “hit” is actually a record of every graphic element on a Web page. Every time a user opens a page, every picture or link is counted as a hit. So a page that’s loaded up with graphics might count as dozens of hits even though it’s only viewed by a single person, while a text-only page with no links would only count as one hit.

“When people use hits, it’s very misleading,” said Larry Riesenbach, vice president of strategic insights at TicketMaster Online-CitySearch. “On average, a TicketMaster-CitySearch site has 11 hits on it. So we look at page views as the primary measure.”

“Page views” represent the number of pages opened on the site. That differs from “unique visitors,” which counts the number of visitors who go to a site no matter how many pages they open. So a user who goes to ticketmaster.com and opens five pages on the site would be counted as one unique visitor, but five page views.

Most Web sites keep track of multiple kinds of user data. TicketMaster-CitySearch records not only unique users and page views, but the time spent on each page, through a data recording system known as a Web log.

“Our (Web log) shows the length of time, number of hits, number of page views, visitors, unique visitors, all that stuff,” said Susan Daniher, vice president of marketing at DVD Express. “We know where traffic’s coming from and where it’s going to, and that’s how we measure the value of our portal partnerships.”

But even that won’t provide all the puzzle parts.

“Let’s say your business goal is to generate revenue by taking orders. What you want to know is who’s coming to my site and why are they ordering and why are they not,” Manning said. “Your conversion rate (of visitors to sales) is what makes you live or die.”

Getting detailed information on when and why people leave a site requires customer surveys or technical tracking that is expensive and time-consuming.

“We’re sort of embarking on that next level, if you will, and that’s the new horizon for us,” Wallraff said. “If (a user) has a system that accepts a cookie (an online fingerprint), you can give them a cookie and then recognize when they come back.”

Services track usage

Once a user has a recognizable identity, companies can record trends and target marketing and promotional efforts to a user’s purchasing patterns. If it works, sales should rise.

While e-commerce firms track usage from the inside, ratings services such as Media Metrix and Nielsen Media Inc.’s Nielsen\NetRatings track them from the outside.

Ironically for the high-tech industry, ratings firms measure Internet usage in much the same old-fashioned way television viewers are measured through samples. Media Metrix tracks Web traffic of about 52,000 Internet users through software installed on their computers (much like the set-top boxes Nielsen uses to measure TV viewership). The company records unique visitors per month, creating an estimate by extrapolating the visits in the sample to the Internet population as a whole.

“The real value in a Media Metrix or a Nielsen or a PC Data is that they look at the Internet on a relative basis,” said Riesenbach of TicketMaster Online-CitySearch. TicketMaster was ranked L.A.’s most visited e-commerce Web site, with about 5.8 million unique visitors in November, according to Media Metrix.

“(Media Metrix’s) numbers tend to be much lower than the numbers we measure. But the value in it is looking at how we’re doing relative to our competition,” Riesenbach said. “Or, if we’re considering doing a deal with someone, we can look at the right category and get an idea of their relative, not their absolute, size. We’d rely on internal data to get their absolute size.”

Still, there are problems with the ratings services. The Internet is not like television; even in today’s cable universe there are less than 100 measurable channels in a given TV market, but millions of Web sites. Even with a sample of 52,000 people, a lot of smaller sites will be impossible to measure, even if they’re getting a respectable number of visitors.

“We’re selling DVD products,” Daniher said. “The player base, people with a DVD player, is around 5 million, which is about 2 percent of the total population. So 98.1 percent of the population does not have a DVD player.” A general sampling of Web visitors won’t accurately reflect usage at DVD Express because of its niche audience, she said.

Media Metrix says DVD Express had 504,000 unique visitors in November. Daniher said DVD Express does not use Media Metrix to measure its users, but could not provide the company’s numbers, citing a quiet period as the company prepares for its initial public offering.

Hyperdrive.com is too small to register on Media Metrix’s radar screen, so it currently relies on internal data. Still, the company plans to someday sign up for Media Metrix’s detailed report service to learn more about the industry as a whole.

“It’s a valuable source of competitive information,” Wallraff said.

L.A.’s Top-Rated Sites

Media Metrix ratings for month of November.

Visitors

Site (000)

TicketMaster Online-CitySearch 5,854

eToys Sites 5,648

Homestore.com Network 2,241

Petsmart.com Sites 1,730

Cooking.com 981

Stamps.com 764

ECost.com 761

CarsDirect.com 730

Tickets.com Sites 538

Carparts.com 525

DVDExpress.com 504

Source: Media Metrix Inc.