Google Gets Into Web Measurement Business
This announcement strikes me as a bit odd. Google, which controls over half of all search traffic, is now going to start telling us what web sites are most used and by which audiences. Certainly Google knows a lot about web sites as their spiders crawl cyberspace ceaselessly. But for them to tell us what sites are the best advertising vehicles when they are one of the options, seems like a major conflict of interest.
The Google AdWords system is far superior to anything else out there. But I’m going to reserve judgment on whether they can tell me where my niche markets are going online, like manufacturing engineers who buy SCADA systems. Those niches may not be able to be automated. (pun intended
This from the Wall Street Journal:
Google plans to unveil a new service that measures Internet use, according to advertising executives who have been briefed on it. The tool is intended to help advertisers identify the best places to buy online ads by telling them which Web sites their target audiences visit.
Google’s approach, aimed at bolstering its ad-sales business, could pose a major threat to the Web measurement services that are available now, ad executives say. The two main players in the business — comScore and Nielsen Online — gather data on Internet use largely by tracking what panels of people do online or by conducting surveys, and their results can be inconsistent and incomplete. Google’s new offering will be based mostly on data from Web servers, allowing for a deeper and broader view of Internet use. And unlike the services from comScore and Nielsen, Google’s will be offered to marketers free, according to ad executives.
But with Google already controlling a growing swath of advertising real estate both online and off, some ad executives are leery about placing even more power in the company’s hands. “For an advertiser, the last thing you want to do is to have your adviser be the same person you are spending your money with,” says Sarah Fay, chief executive of Aegis North America, the media-buying giant owned by Aegis Group of the U.K.
ComScore said it wouldn’t comment before Google makes an official announcement. Nielsen Online also declined to comment.
Billions of marketing dollars a year trade hands based at least in part on Web-audience figures. Advertisers study the data — which can estimate the total number of people that visit a Web site or the average amount of time those people spend on the site or both — to try to determine which sites are popular among particular demographic groups or in certain topic areas, such as technology or health. Publishers also rely on the data to set ad rates.
Google’s new tool could bring more efficiency to the process of buying online ads, ad executives say. Google already has one of the dominant systems for online ad-serving, which helps Web publishers manage their advertising sales and serve up ads each time a consumer opens one of their Web pages. The Web-audience data could be combined with the ad-serving system, so that advertisers would be able to find out whether they would reach the right audience before they committed to placing an ad. Existing ad-serving systems don’t currently provide detailed Web-audience data about the sites where they place ads. By giving away the new tool, Google could presumably attract more ad business.
Separately, Google this week is expected to roll out a new tool aimed at showing how Web surfers respond to online ads. It will compare groups of people who are exposed to an ad with others who haven’t seen it, taking into account such factors as search activity and site visitation.
For all the cutting-edge technology on the Web, the systems used to measure Internet use are mostly based on traditional models. Both comScore and Nielsen rely on panels of people who agree to let the companies track their online movements, from the Web sites they visit to the purchases they make. ComScore and Nielsen then take these data and extrapolate from them to make statements about the broader population of Internet users. In some cases, Nielsen benchmarks its findings against a Web site’s computer-server logs.
With its new service, Google, like comScore and Nielsen, will offer marketers demographic details about potential customers, such as age, gender and income. Google’s new tool, which will also rely on some data gleaned from panels of human users and other sources, is similar to one developed by New York-based start-up Quantcast, which has been gaining popularity among media buyers. But because of its size, Google has the potential to shake up the Web-measurement business.
Server-based data come with challenges of their own. Measurements are generally based on “cookies,” or small pieces of tracking data, on Web surfers’ computer hard drives. Because consumers sometimes delete cookies and then get new ones when they return to a site, server-based systems often overcount audiences. Also, a computer server can have a hard time distinguishing whether a site’s visitor is a real person or a technology that visits Web sites for other purposes. In addition, server-based systems can track only those Web sites with which they have struck agreements to place cookies.