Nielsen data error spooks industry

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Ratings and data provider The Nielsen Co. told customers last month that it erroneously reported a 22% year-over-year decline in consumers' time spent on some US websites. The company said it was working with the Media Rating Council, a nonprofi t that ensures audience measurement standards are reliable, to fi x the problem. Nielsen explained that the error, caused by long URLs, should be resolved in its December 2010 data, which it will provide in January 2011.

Leslie Radcliff, of ArnoldIT.com's Beyond Search blog:

The miscount seems to have sent the illusion that Web traffic is down nearly 22% in the past several months when, in fact, this may not be the case at all… To most people, this might not seem like a big deal, but it is. Because Nielsen has a corner on the market, this error is going to be felt by many online media and advertising outlets. The numbers that Nielsen puts up affect how companies allocate their funds. If the numbers aren't high enough, the companies won't put money into the website. 

David Kaplan of PaidContent.org:

The full effect on customer research isn't entirely known yet…While the number of unique visitors is considered the most important number for websites, measuring time spent is becoming just as important for attractive advertisers, as promises of “engagement” are expected to yield more lucrative branding campaign dollars.

Paul Newman from Experian QAS' Data Quality News: 

Nielsen explained that long URLs...appear to be the culprit that caused it to report an “estimated average
22% decline in time spent, year-over-year” on websites. Page impressions, unique visitors, on site and individual pages are important metrics to a number of industries, and the Nielsen data is used by a number of organizations. The news may inspire US businesses to look into how they can improve their own data collection processes to avoid making costly and potentially damaging errors. 

Derek Mehraban, from Ingenex Digital Marketing's Digital Bus blog:

Nielsen's data failed to include hits of pages with too-long URLs. While this error does not include most Web traffic, it could account for the loss of 22% of time spent on the Internet. This gap is particularly troubling for digital marketers, because most of the pages using the long URLs are social networking sites, where advertising is particularly useful and sticky. For digital marketers the lesson is simple: We need redundant data tracking, and we also need to diversify our marketing efforts.

OUR VIEW:

Direct marketers rely on correct measurement and analytics to tell clients exactly what results they're paying for. The pressure is on Nielsen, a company synonymous with ratings, to correct the Web measurement problem and reassure marketers that it provides accurate site visit statistics. The news of Nielsen's incorrect Web visitor data came just after online advertising spending jumped more than  11% during the first half of the year, according to the Interactive Advertising Bureau. If Nielsen doesn't fix its statistics, the company runs the risk of prompting some of these online marketers to pull back on their Web ad investments.  


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