Traffic comparison: Alexa vs Google Trends vs Compete vs ComScore

I cringe every time someone pulls traffic/audience numbers from Alexa for competition/market research. Alexa is simply bullshit when it comes to Indian websites. But, what about other such tools? Have you ever wondered where & how these website traffic-research tools get their data?

Alexa

Here's what Alexa discloses (emphasis mine):

Alexa computes traffic rankings by analyzing the Web usage of millions of Alexa Toolbar users and data obtained from other, diverse traffic data sources.
[...]
The traffic data are based on the set of toolbars that use Alexa data, which may not be a representative sample of the global Internet population.

That's right. They get their data from people who download and install Alexa toolbars. They mention "other, diverse traffic data sources" about 8 times on that page, but fail to mention, even once, what those "other, diverse" sources could be.

Compete

Here's how Compete does it (emphasis mine):

Compete’s clickstream data are collected from a 2,000,000 member panel of US Internet users (about a 1% sample), using diverse sources.
[...]
Compete’s panel measures US, but not international users. Compete has worked diligently to develop what it believes is the largest and most diverse panel of online consumers in the United States.

Compete also fails to mention their "diverse sources", but at least they mention the sample size (2 million) and sample geography (US internet users) very clearly. Their claim of "about a 1% sample" is also correct: total internet users in North America are about 272 million (source).

ComScore

And here's ComScore's methodology:

Central to most comScore services is the comScore panel, the largest continuously measured consumer panel of its kind. With approximately 2 million worldwide consumers under continuous measurement
[...]
comScore recruits panelists through a variety of online methods designed to ensure a demographically-balanced and representative sample.

ComScore's methodology page is the biggest mish-mash of marketing gobbledygook I've ever seen. And a sample-size of 2 million worldwide is the biggest joke! That would make it a 0.1% sample size based on the world internet user population of approx 2 billion (source). Probably a 0.1% sample size is statistically significant on a global scale, but how does that distribution change for India? Is their sample size in India also statistically significant? They fail to mention that.

And I'm not sure what these "variety of online methods" to recruit panelists are. I have been spending at least 5-6 hours each-day on the Internet since the last 7 years, but have NEVER been solicited by ComScore to become a panelist. Neither has anyone I know.

Google Trends for Websites

Compare this to how Google Trends for Websites generates its data (emphasis mine):

Trends for Websites combines information from a variety of sources, such as aggregated Google search data, aggregated opt-in anonymous Google Analytics data, opt-in consumer panel data, and other third-party market research.

Google Search and Google Analytics are the core data-sources that power Google Trends for Websites. For the uninitiated, most websites in India would be getting 30% or more of their traffic from Google (paid + organic). Google Analytics is the most widely used analytics system on the Indian internet scene.

Conclusion

Now think - how many users have you seen (in India) with an Alexa toolbar installed? Is anyone you know on the ComScore panel? Compare that to how many people you've seen using Google Search? People entering domain names in Google (eg. enter 'flipkart.com' as search query on Google)? Websites that use Google Analytics for measuring+analyzing their visitor data?

I'd bet my money on Google Trends for Websites any day for researching the Indian internet scene. What about you?

Advertising as a business model?

If it was not already well-known that Internet advertising as a way to make money is extremely hard, today's Facebook IPO filing gives us more data to support it. In 2011, 85% of Facebook's total revenue (USD 3.711 billion) came through advertising, which is approximately USD 3.15 billion. That's HUGE! However, what is equally huge is their MAU (monthly active users) number at 845 million in Dec-2011. If we take some approximations and do the math, it means Facebook managed to make barely 36 cents per active-user, per-month.

Yes. Barely 36 cents per-active user, per-month. [1]

According to Alexa, Facebook gets an average of 13 pageviews per-user per-day. According to this report each user visits Facebook an average of 40 times per-month. This would mean:

• a minimum of approx 440 billion pageviews (!) in Dec-2011 [2]
• a maximum CPM of 60 cents per thousand page views [3]

Yes. Barely 60 cents CPM. On a per-impression basis this number could be 3x lower because Facebook has about 3 ads per page.

And that's the #2 website in the world. No wonder traditional publishing companies are dying everyday - not everyone can have close to a billion active users to allow a few cents per-user to cover their costs. Internet advertising is such a horrible monetization model. We have to think of something better!

[1] And that's the number per active-user. If we compute this for total users, the number will be much lower.
[2] 845 monthly-active-users  x 13 pageview per-user per-day x 40 visits. Not the best calculation, but good enough to give us a minimum value
[3] USD 3.15 billion divided by 12, to get the average monthly revenue, divided by 440 billion pageviews x 1,000. Again, I know, not the best, but good enough to give us a ballpark.

"First they came for the communists..."

The biggest promise of the World Wide Web was the free flow of ideas & information. It is coming to a swift end. Very sad, indeed.

• Google to censor content on per-country basis
• Twitter to censor content on a per-country basis
• The Indian IT Act 2008 & Information Technology (Intermediaries guidelines) Rules, 2011

I wonder what Tagore would say about this:

"Where knowledge is free; Where the world has not been broken up into fragments by narrow domestic walls;" 

PS: For those wondering about the post title, read the entire poem/quote