The move driven by a loose grouping of major media companies comes in response to years of confusing data and definitions for measuring and reporting site popularity. They believe the lack of consistency has resulted in uncertainly and mistrust which has kept advertisers away from the web.

The publisher’s group, including members of The Internet Bureau, The Communications Agencies Association (CAANZ) media committee - representing advertising agencies - and New Zealand's largest online publishers XtraMSN, INL’s Stuff, TVNZ’s NZOOM, the NZ Herald, and IDG.net put out a request for proposal at the beginning of this year. They’ve selected Australian-based global internet reporting company RedSheriff and Pheonix Research as providers of a standard measurement solution.

A benchmark sample across the publishing industry will be established in September to produce the first industry-based website ranking. Data will be gathered from participating publishers about their own traffic and quantified and checked by RedSherrif. The survey company will also conduct a series of on-line and phone surveys to get demographic data including age, income and work and home use.

The resulting metrics will give clients information about their own web site so they can make better decisions as well as ranking them within their sector. This will give RedSheriff a basis to extend its surveys to other industries.

To buy-in to the new service will cost around $100 a month at the low end delivering basic site measurements, an audited traffic report, inclusion in the industry ranking and for an extra fee more detailed information about what’s happening in different parts of a site. At the next level a $500 fee will buy 60 different reports covering multiple web sites and the company intranet. A further level might include up to 200 reports.

"The survey will ultimately include an across the board comparison with other media types," says RedSheriff business development manager Marcus Lloyd. The company is currently adding new technology and staff to ramp up its web analysis capabilities.

While the publishing industry is the primary audience with a view to helping advertisers gain confidence in the on-line market the exercise will develop standards for audience measurement of web sites across the board.

The move is in line with a global trend to bring accountability and standards to web site statistics to prove the medium is maturing. In recent weeks the Australian Internet Industry Initiative, made up of major on-line players, adopted common definitions and terminology for web monitoring and efforts are well underway to produce a common view in the US market.

Internet Bureau boss John Stewart says up until now people have used different numbers to suit themselves, ranging from marketplace measurement systems to company’s interpreting information generated from their own server logs. "The terminology has ranged from hits and page views to user sessions - there’s been a lack of consistency and questions about what is an acceptable methods of measurement. We need to know for example how to verify the data when a site claims it’s getting a million people a month."

If that data is verifiable and you were able to say your motoring web site got 15,000 unique users a month and of those 10,000 read the car review section then a media buyer could compare that to other opportunities for people interested in cars and make a more informed decision, says Mr Stewart.

The decision to go with RedSheriff hasn’t won unanimous support – there have been concerns about cost, the amount of work participating sites need to do, and how the internet statistics relate to other media figures.

While the cost is now being clarified companies who were unsuccessful in bidding for the metrics business claim some sectors of the internet community will miss out and that internet statistics don’t mean a lot on their own.

Brian Milnes, former managing director of Nielson NetRatings, now an independent consultant, is concerned the ‘people factor’ may be overlooked by RedSheriff and that internet data in isolation will not give an accurate view of where the web fits in the overall media picture

NetRatings was established here to try and provide accurate metrics on the internet market but pulled the plug last year when the demand failed to eventuate. "Essentially the business was based on the US pricing model and New Zealand couldn’t stand the cost," says Mr Milnes.

In conjunction with Nielson International Mr Milnes did however pitch for the publishing industry proposal based on integrating the ratings with television, radio statistics and readership but didn’t get past the first evaluation.

"It’s a good idea to try and standardise the view of things but everything I’m reading from the US suggests that internet measurement has to be integrated with the systems that are used to measure traditional media. Until a media planner or buyer can sit down and talk about the internet in terms of target audience rating points (TARPs), reach and frequency it’s never going to grow up."

While RedSheriff, and the other competitor for the business Hitwise, measure internet use by counting machine activity the prime difference with NetRatings is that it analysed people and behaviour.

"If you measure machine-to-machine activity you have no idea what’s really going on behind the scenes. One IP address might represents 300 people surfing the net at one company or a family of four sharing the internet at their home. A bigger problem is that most ISPs dynamically allocate IP addresses when you make a connection - you can surf the net for a month and each time you are given a different address - that might be counted as 30 different individuals."

Mr Milnes is convinced the contract with RedSheriff will need to be reviewed in the short term. "It is a totally isolated view. The Americans believe the internet accounts for about 15 per cent of media minutes in the US yet they’re only getting less than four per cent of media dollars. To bridge that gap they know they can’t work in a stand-alone situation. Media planners haven’t understood clicks and hit rates and haven’t even tried."

Fresh attempts in the US and Australia to establish a common approach are being well received and there’s hope that the advertising industry will take the on-line industry more seriously. "The internet industry has ditched its arrogance and learned that as with business plans, cashflow and balance sheets there is not new way of doing things," says Mr Milnes.

Hitwise isn’t exactly impressed with the publishers choice either. In conjunction with NFO New Zealand and Information Tools it developed a new module, which it claimed was a world first. It would have enabled the industry to monitor over 85 per cent of the New Zealand’s internet population and provide demographics, ‘reach and frequency’ and purchase intent for the top 50 websites and publishers visited by New Zealand users.

"New Zealand would have led the world in internet metrics innovation by creating a marketing focused standard for all internet businesses - publishers and advertisers alike," says Hitwise New Zealand manager, Paul Hashfield

Instead he says the publishers group opted for a site centric methodology, which will only measure the and provide data on the top publishers excluding all other online businesses.

Hitwise monitors Internet Service Provider (ISP) networks to capture the usage patterns of the ISP’s user base, extracting a list of the websites visited and ranking them according to a range of industry standard metrics including page requests, visits and average visit length. Hitwise also analyses the movements of visitors between sites providing subscribers with information on traffic to and from competitive sites.

Hitwise will continue to offer its existing on-line intelligence, which provides marketing and advertising insights on the whole market. We currently monitor over 350,000 users - over 20 per cent of New Zealand's Internet population," says Mr Hashfield.

The one thing that is certain is that the decision to standardize methodologies is a move in the right direction – conflicting information has benefited no-one. Accurate benchmark-based statistics will at least provide strong guidelines to help advertisers know where to invest and why, as well as helping individual sites understand if they’re meeting their own audience targets.

The on-line advertising spend in New Zealand this year will be between $8-$10 million – or 0.5 per cent of the overall billion dollar spend across all media with major potential for growth once believable measurements are established.

Internet Bureau chief John Stewart says in the US the on-line spend is about 3.5 per cent on-line of the overall media dollar and in Australia it’s 1.5-2 per cent (est $A60 million). "We’re a good year behind Australia but there opportunity for considerable growth – we could easily grown to $15 million over a greater number of sites within the next 12 months.

Mr Stewart says there’s already a wind change in media spending with greater on-line investment being made. To date travel, technology and financial services are the main beneficiaries and consumer goods is slowly starting to figure, driven by companies like Coca Cola who are starting to play in that space in the US.

He says establishing standard metrics and language to rate site popularity will give people more confidence when making decision. Currently only about New Zealand sites are considered by the advertising industry for placements.

MSNXtra, NZoom, NZHerald, Stuff and IDG get the bulk of on-line advertising budgets currently. "They’ve got the biggest sales teams and have made the biggest investments in that space." There are also niche players coming off the back of existing publications including the classified space including jobs, automotive and real estate.