Chicago start-up nCognito Interactive Services Inc. aims to challenge entrenched Web-audience measurement firms Media Metrix and Nielsen/NetRatings by giving away basic demographic reports.
“Research is our loss leader,” said Kirk Davis, vice president of marketing at nCognito.
The idea behind the offer is to get enough partner sites to gain critical mass for a co-op database of Internet-user profiles the firm is building. For revenue, nCognito will charge for more in-depth reports, and for participating sites to use the individual profiles to deliver personalized advertising and content.
Under nCognito’s business model, partner sites take registrations and feed the co-op database with information about the activity of visitors. Sites that contribute to the database receive free monthly demographic reports on their visitors.
The resulting Internet user profiles will include information from all of nCognito’s partner sites.
“The pool of information available to you is much bigger than the piece you brought in,” said Bill Sarther, CEO at nCognito, adding that the firm also will sell reports to non-participating companies.
“Our business model will generate revenue through custom reporting and marketing actions such as ad and content serving,” he said
Unlike online advertising firm DoubleClick’s controversial effort to marry clicking data with offline purchasing behavior, however, nCognito claims it will not collect personally identifying information.
DoubleClick recently came under fire when it was reported that about a dozen Web sites have begun accepting registrations, planning to marry the clicking behavior of consumers with offline purchasing data from recently acquired Abacus Direct Corp.
Abacus manages the largest co-op database of consumer catalog buying habits in the United States, comprising records from 1,100 catalogs that direct marketers use to predict purchasing behavior.
“We can provide the ultimate online experience, [so] we are willing to legally commit ourselves to never touch them offline,” said Sarther.
nCognito claims that about 20 sites have agreed to begin contributing to the database so far, and that it has some 50,000 profiles. One of the partners is MyCity.com, a local content site that will officially launch on March 31.
“Everybody is looking to build their subscriber base, get to know them and cater to them with products and services, but there’s a fine line between knowing your customer base and invading their privacy,” said Kristen Routh, vice president of marketing at MyCity.com, Miami Beach, FL.
“For us to go IPO, a lot of things have to happen, including having a lot of people register at our site and opt in to a lot of our programs, so privacy is our No. 1 concern,” she said.
MyCity.com also chose nCognito because it uses actual visitor profiles to create its reports, as opposed to Nielsen/ NetRatings and Media Metrix, both of which monitor the clicking behavior of panels of thousands of Internet users and extrapolate the results.
“Their [panel data] sample isn’t pure … and it’s superficial,” Routh said. “There was no other company that we found
that could give us analysis on our user without having to share our user name with that company. We share everything about [MyCity.com visitors] except for who they are.”