Web sites Asked to Disclose Circulation Figures

SAN MATEO (05/12/2000) - Mounting pressure from advertisers and investment bankers to make e-commerce sites accountable to traditional practices for monitoring and publishing circulation figures could be addressed next quarter with the debut of Audit Central.

The Audit Central Web site, which was first proposed by New York-based Ogilvy & Mather International and is slated to go live in early July, will be hosted by three leading online auditing companies: ABC Interactive, BPI International, and iNielson.

Audit Central will be a site where interested third parties can go to disclose audit figures, discover which Web sites are audited, and learn how and when they were audited. Each audit company will also post an explanation of its auditing methodology, which is critical to evaluating the numbers.

Competitive analysis is extremely difficult, said Gerard Broussard, Audit Central's creator and senior partner and director at Media Metrics and Analytics for OgilvyOne, Ogilvy's online division.

For many years, major advertising agencies such as Ogilvy and BBDO have urged clients not to advertise on unaudited sites. IBM Corp., General Motors Corp., DaimlerChrysler AG, Sears Roebuck & Co., Ameritrade Inc., and others have adhered to that policy.

However, not everyone thinks Audit Central is a good idea.

"Most local sites aren't audited, and many don't tell the truth, so there is a competitive disadvantage to me standing out there naked as being the only honest guy," said Jeff Jarvis, president of AdvancedNet, part of the CondeNet magazine group, based in New York.

And there is disagreement about what numbers are significant.

"There's no value in [a traditional audit]," said a circulation executive at a major publishing house, who requested anonymity. "The media buyers who buy online don't care whether page views are audited or not. What they buy is whether or not you can deliver their ads."

Agencies want to know if they got the number of impressions they paid for, and in many cases it does not matter whether it takes two weeks or two months to get the number, according to the circulation executive.

However, at least one industry analyst strongly disagreed.

"Impressions are not enough," said Steve Telleen, managing director of the Web Site ScoreCard Service at Giga Information Group Inc., in Santa Clara, California.

The key difference between Web and traditional broadcast media is interactivity, Telleen said. A TV ad is one-way communication, but Web site visitors can take action.

"So the question becomes not just how many impressions [are being made], but is it the right people [making them]?" said Telleen.

Despite that difference, most observers said Audit Central will bring some semblance of organization to a chaotic situation. For instance, both advertisers and venture capitalists will be able to see if they are getting what they pay for, OgilvyOne's Broussard said.

"Up until recently, asking Web site publishers for circulation [was] akin to the fox guarding the chicken coop," Broussard said.

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