@SIABIZ - The Battle Begins
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By Kitty McKinsey
Issue cover-dated December 7, 2000
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IT'S BEEN AN EXPENSIVE GAME of pin-the-tail-on-the-donkey for companies advertising on Asian Web sites. With nothing better than guesswork about who was using which Web pages, advertisers were in the dark, simply gambling that their banner ads would reach their target audience.
Now that's all changed. In the past few months, a number of companies have burst into the Internet-tracking business, objectively measuring and analyzing the audience for Asian portals and individual sites. Hong Kong-based Interactive Audience Measurement Asia, which goes by the name iamasia and has been in business only since last year, scored a coup in mid-September when it unveiled the first verified figures for site popularity in China.
Other big players in the so-called metrics arena in Asia are AC Nielsen (whose on-line research business is called Nielsen//NetRatings) and NetValue, an offshoot of the well-established French metrics company of the same name. NetValue conducts research in China, Hong Kong, Korea, Singapore and Taiwan, and plans to move into Australia, India, Japan and Malaysia. Media Metrix, the top U.S. Internet-tracking company, is active in Japan and Australia and plans to move into Korea. There are also a number of home-grown metrics firms in Korea and Japan that focus on local Web sites.
"The reason it's taking off so quickly is that it's an open playing field and these companies see an opportunity to get in early and grow with the market," says Dane Anderson, vice-president of Internet research at International Data Corp. in Singapore.
Measurement companies all operate in basically the same way, using a panel of up to 4,000 volunteer Web surfers in each country. Software placed on the volunteers' computers allows the companies to follow surfers everywhere they go on the Web. This is a huge leap forward from the days--just a few months ago--when the only measurement was the Web sites' own highly unreliable claims of page views. "Now you are able to count the number of eyeballs who come to your Web site," says Louis Boswell, chief operating officer of iamasia.
But "there's more to Internet measuring than just counting eyeballs," counters Clayton Fitts, vice-president of sales and marketing for NetValue in Hong Kong, giving a glimpse into the fierce battle that's on among the big players to differentiate themselves.
Iamasia is trading heavily on its "first-mover" status and its expertise in China. Previously the only available statistics on the country's Web users came from the semi-official China Internet Network Information Centre, which asked Chinese Web surfers to vote for their favourite sites. Meanwhile, NetValue positions itself as "offering more comprehensive data" because it tracks not only which Web pages users visit, but other Internet activity like e-mail and game usage, says Darlene Lee, president of NetValue in Asia.
Nielsen//NetRatings, active in 16 countries that account for 80% of the world's Internet traffic, is trading on AC Nielsen's 50-year history as a market researcher and its brand name, which is synonymous with television ratings in the U.S. "Our brand name is absolutely a huge advantage for us, and I think our competitors would probably agree with me," boasts Hugh Bloch, managing director of parent company AC Nielsen eRatings.com in Hong Kong. Familiarity with the brand name, he says, has helped Nielsen//NetRatings recruit panels that are representative of the larger Internet audience in Australia, New Zealand, Singapore and Japan. It plans to start service in Taiwan and Korea by year's end, and China by early next year.
Most agree the Internet tracking firms are filling a huge void. "Gone are the days when people would just throw money at a Web site and hope that some of it would stick," says Steve Yap, marketing director for iamasia. "People are increasingly demanding measurement and accountability."
Joe Chang, head of Internet research at Credit Suisse First Boston in Hong Kong, says he relies heavily on iamasia's research in Greater China to advise clients interested in investing in Asian dotcoms. For investors, Chang says, objective research "really cuts through the clutter. It's an independent voice that's audited." Adrian King, director of Beyond Interactive, a Hong Kong company that buys advertising space on-line for companies like Pacific Century CyberWorks and Volkswagen, says the new information is invaluable. "Nobody in their right mind would pay for a television campaign without television ratings," says King, and now they can expect similar data before making on-line advertising decisions.
What's missing, however, is a set of industry-wide standards. "Everybody's talking about different things," admits Lee of NetValue. King agrees: Advertisers "want a global standard, to get the same sort of information from around the world." But once a universal benchmark is accepted, analysts and industry insiders say, there won't be a need in any market for more than two Internet-measurement firms.
Striving for pre-eminence is an expensive gamble. AC Nielsen has calculated it will lose $50 million on its Asia operations this year and next. "None of the measurement companies anywhere in the world--even in the U.S.--are actually making money right now," says Yap. His company, iamasia, is no exception. NetValue doesn't plan to break even in Asia for three years. "Everyone who does it definitely is in it for the long haul," says Lee. "It's not a get-rich-quick scheme."
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I-BRIEFS
A Hong Kong government survey showed shoppers are suspicious about buying on the Internet, with only around 0.11% of business sales in 1999 coming from transactions completed on-line.
Singapore Airlines plans to invest $11.4 million in the next year in forecasting technology to better match seats on each route with demand.
Pakistan cut charges for high-speed data-transmission lines by 76% to attract foreign investment and boost software exports.
China is considering adopting a one-way billing system where mobile-phone companies would charge only for out-going cellphone calls, and not for incoming calls as at present.
The 10 member nations of Asean will work with U.S. firms General Motors, IBM and Sun Microsystems to set up Internet portals and develop information technology in the region over the next 10 years.
Citibank customers in Singapore can now apply for credit cards on-line.
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