Charging that Internet audience measurement services comScore Networks Inc. and Nielsen/NetRatings produce data with unexplained discrepancies, the Interactive Advertising Bureau, or IAB, has called on each to submit to an audit by the Media Rating Council, a marketing industry group whose audits are conducted by independent certified public accountants.
IAB president and CEO Randall Rothenberg, in a letter to comScore and Nielsen/NetRatings, charged that the two firms use old methods of measuring audiences, such as consumer panels first developed in the 1930s, and produce data that leave discrepancies not only between comScore and Nielsen/NetRatings data but also between their data and information compiled by IAB’s members. The IAB has about 300 member companies involved in online interactive advertising, including IAC/InteractiveCorp, Discovery Communications and MovieTickets.com.
“To persist in using panels that potentially undercount or ignore the diverse populations that are the future of consumer marketing is to deny marketers the insights they need to build their businesses,” Rothenberg says in an open letter to Magid M. Abraham, president and CEO of comScore, and William Pulver, president and CEO of Nielsen/NetRatings, which is a unit of The Nielsen Co., a major provider of information for and about the marketing industry. “And it certainly appears to us as if these audiences are being undercounted or disregarded.”
The IAB declined to elaborate on particular discrepancies in data produced by comScore and Nielsen/NetRatings. But it says its challenge to the measurement companies is backed by the Association of National Advertisers and the American Association of Advertising Agencies. “I applaud the interactive industry’s commitment to transparency, and I support any initiative that moves us closer to the real answers marketers need,” says Bob Liodice, president and CEO of the Association of National Advertisers.
Nielsen/NetRatings responded to the IAB’s letter by noting that the measurement services firm had already completed a pre-audit by the Media Rating Council and was committed to transparency and cooperation in working with the IAB. “NetRatings is the only Internet audience measurement company to have completed the MRC’s pre-audit, and we are currently executing on a formal research plan jointly developed with the MRC’s research committee,” Pulver says. “We look forward to taking the next appropriate steps in the audit process.”
Anthony Torrieri, senior vice president and associate director of the Media Rating Council, confirmed that NetRatings completed its pre-audit last year but had not yet accepted the council’s request to submit to a full audit by a certified public accounting firm. Pre-audits, which are not conducted by certified public accountants, are provided as a Media Rating Council service to help a measurement company identify areas of operations that may need improvement, Torrieri says. “Nielsen/NetRatings has an audit proposal from us and we’re ready to start a full audit. The ball’s in their court,” he says.
ComScore is getting a pre-audit, a process that can take over a year, and is nearly finished with it, Torrieri says. He adds that comScore has requested that its pre-audit report not be shared with council members, an option the council provides measurement services even though it encourages them to share their pre-audit reports. “We hope that companies will share these reports with council membership so we can help them work out any discrepancies,” he says.
In a statement issued in response to the IAB’s call for an audit, comScore said it “welcomes the objective outlined in the IAB open letter of achieving transparency in panel methods for measuring the size of online audiences,” and it referred to its cooperation with the IAB in developing a process for “understanding the root cause of the difference between web site server logs and panel-based measurements.”
But comScore has declined to say whether it would cooperate with a full Media Rating Council audit; instead, it says it has opened its methodology and processes to an evaluation by the Advertising Research Foundation, an organization founded by members of the Association of National Advertisers and the American Association of Advertising Agencies.
Although the Media Rating Council and the Advertising Research Foundation have similar goals and overlapping membership rolls, they also have distinct differences. The Media Rating Council, initiated by a committee of Congress reviewing radio and TV industry regulation in the early 1960s, does not include audience measurement services like comScore and Nielsen/NetRatings among its membership, and its audits are conducted only by independent CPA firms. Audits cover every aspect of measuring service operations, including how samples are determined and how well measuring devices work in homes, Torrieri says. Measurement services that successfully complete an audit are listed on the Media Rating Council’s web site as accredited services.
The Advertising Research Foundation, whose members include comScore, Nielsen/NetRatings and other measurement services as well as advertisers and advertising agencies, does not conduct audits or in any way rate the value of information provided by a measurement service, says Advertising Research Foundation CEO Bob Barocci. Instead, the Advertising Research Foundation conducts its “research reviews” or evaluations of measurement services as more of a consulting engagement intended to show how a company could provide more valuable information, he says.
ComScore, which did not return a call for comment, completed an Advertising Research Foundation research review in 2003 and entered a second review last year following a change in its measurement process, Barocci says. “They are taking this very seriously,” he adds.
The current research review of comScore is expected to be completed soon and shared publicly, comScore said in its reply to the IAB’s call for an audit. “We look forward to working with the IAB and the rest of the industry on establishing measurement standards for all participants,” comScore CEO Abraham said in the reply to IAB.
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