NetRatings Goes Down Under to Expand Site Analytics
Updated · Dec 23, 2003
Web measurement firm NetRatings
is expanding into site-specific metrics by acquiring RedSheriff for more than $12 million.
The Milpitas, Calif.-based NetRatings paid the $12 million to buy a 58 percent stake in the Australian measurement firm from investor Morgan Grenfell Private Equity Limited. It will offer to buy out the rest of RedSheriff shareholders over the next several weeks, which could bring the total outlay up to approximately $16 million, if NetRatings pays the same per-share price to other investors.
“Our clients have been calling for increased clarity around the metrics provided by panel-centric and site-centric research to support the growth of online advertising,” said William Pulver, president and CEO of NetRatings.
There’s been a tension between panel-based and site-based Internet audience measurement techniques, because many publishers have found their internal numbers to be significantly higher than those tallied by panel-based services like Nielsen//NetRatings and comScore Media Metrix. Another cited weakness of panel-based measurement, which isn’t a problem with site-based solutions, is that it often fails to measure at-work or other out-of-home usage. That’s because businesses, for example, often balk at installing the software that panel members must have running to measure their activities.
Now, NetRatings is planning to take a close look, internally, at why those measurements often differ, and take a stab at reconciling them.
“The opportunity is to combine the panel information with the [RedSheriff] information,” said Manish Bhatia, SVP of products and services at NetRatings. “Both have their pros and cons.”
NetRatings had already dipped its toes into site-based audience measurement with a joint venture with SelectMetric. That partnership allowed it to launch a product called SiteCensus in April. It’s not clear whether that product will be abandoned or somehow integrated with RedSheriff’s offerings.
RedSheriff’s products include site audience data, a Web ratings product based on site census data, and customized research and consulting. The company earlier this year purchased start-up Traffion, which focuses on online advertising measurement.
The acquisition will give NetRatings access to RedSheriff’s more than 500 clients. While the companies didn’t detail their client lists, it seems likely that the Australian company’s presence Down Under would help NetRatings grow stronger in the Asia-Pacific region. The purchase will also help NetRatings grow stronger financially. RedSheriff had annual revenues of $7.5 million in the 12 months prior to Sept. 30, 2003, and NetRatings executives expect it to contribute to the bottom line in 2004.
NetRatings is sending a team down to Sydney early in the New Year to assess how best to integrate RedSheriff’s products and 63 employees.