• by Jack Loechner , Staff Writer, May 22, 2002

I/PRO report highlights how advertisers evaluate media and what it will take for the Web to command more ad dollars.
In large part, the success of the commercial Web lies in the hands of advertisers, says Internet Profiles Corporation (I/PRO), which recently commissioned IntelliSurvey to conduct a survey to help understand what fuels the demand for online advertising — and where its biggest failings are. According to the resulting report, titled "Assessing Measurement Systems Online and Off," both online and offline advertisers (including Internet, print, radio, and TV) found the Internet to be a less effective vehicle than the others, but clearly saw promise for its future. A sample of 145 agencies and advertisers, representing more than $12 billion in billings for all media, concluded that demographic targeting and measurement standards are the two areas where improvement is needed most.

Even though in theory the Web offers the ability to identify and target specific types of users, advertisers have yet to find the key to opening the demographic door, blaming a lack of measurement standards and validation. The respondents see print measurement as the most accurate, radio the least, and the Internet and TV somewhere in between. Only 25% of these respondents consider the Internet to be very or extremely effective in reaching their target audience. This compares with 51% for print, 44% for radio, and 75% for television.

In selecting media advertising locations, respondents cited demographics as the most important criterion 41% of the time for the Internet, with content the second most common answer at 35%. Interestingly, demographics was an even stronger first choice for the other three media: 58% for print, 65% for radio, and 57% for TV. And 51% of respondents who advertise online expressed a strong bias in favor of "unique visitors" as a metric, substantially outpacing page views at 18% and visits at only 8%.

Measurements must also be accurate, an area where the Web is perceived by all advertisers to trail other media. Forty-one percent felt print measurement is the most accurate, while 27% cited TV and the Internet, and 6% radio. Websites typically use internal tools to measure traffic based on proprietary access to their own Web logs. Unlike panel-based reporting, this technique can be accurate. Self-reporting receives a thumbs-down, however, from the online advertising community, which considers it untrustworthy.

And though panel-based reporting from third-party ratings services is the most common reporting method for the Internet, advertisers are skeptical of the accuracy of these numbers as well.

The debate became even more critical recently when CBS MarketWatch denounced the click as a standard performance metric and said it was changing its reporting system. Meanwhile, the Advertising Research Foundation and the Interactive Advertising Bureau are getting closer to issuing more guidelines for audience measurement, which they hope will push the industry toward standardized reporting.

Despite this shortcoming, the Internet received top marks in: • Ease of Performance Measurement 36% believe the Internet to offer the best, vs. 29% each for print and TV, only 6% for radio • Flexibility of Program Design 47% believe the Internet to offer the best, vs. 23% for print, 22% for radio, and only 8% for TV • Speed of Response 63% believe the Internet to offer the best, vs. 18% for TV, 12% for radio, and 6% for print The same respondents perceived the Internet to trail in these other areas: • Breadth of Audience Reach 13% believe the Internet to offer the best, on par with print at 11% and radio at 6%, but dramatically trailing TV at 71% • Return on Investment 16% believe the Internet to offer the best, vs. 33% for TV, 31% for print, and 20% for radio

Given that Internet advertising makes up only a small fraction of all advertising, its advantages do not yet outweigh its drawbacks, I/PRO says.

The ARF’s new Digital Media Measurement Council is working on measurement problems such as inconsistent definitions and sampling techniques and data discrepancy between third-party measurement companies and Web publishers. It is also updating the Coalition for Advertising Supported Information and Entertainment glossary of ad definitions to relate traditional metrics to online metrics.