Will Online Traffic Scandal Make Newspaper Circulation Scandal Look Like Child's Play?
from the math-is-hard dept
Two years ago, the corporate scandal of the summer was all of the big newspapers who were caught lying about their subscriber numbers to advertisers, and it got them in all sorts of hot water. The numbers of “ghost subscribers” tended to be in the tens of thousands of subscribers — representing a few percent of actual subscribers. What’s amazing, as so much advertising moves online, however, is that there’s been almost no skepticism over whether or not something similar is happening online. In the last few months, we’ve seen a number of sites claiming traffic numbers that are unlikely to be realistic, but which the press is often passing on as if they were fact. A few reporters have picked up on this, and now the NY Times is pointing out that Forbes.com appears to have been pumping up its traffic numbers to help its standing with advertisers (and to help it secure venture capital investment) — perhaps by millions of visitors. The numbers are a lot bigger than the newspaper circulation scandal from a few years ago, and it seems like only a matter of time until the same questions are raised online. The various newspapers involved in the ghost subscriber scandals a few years ago got punished and had to pay up — but will web publications face the same punishment as well? Part of the problem is a lack of agreement about how to count online visitors — and stats packages that return wildly different numbers. A second issue is that many ad deals are based on specific impressions, so it doesn’t matter how much overall traffic a site is getting as long as the specific impressions are accurate (though, as in the Forbes.com case, the company clearly was using its traffic numbers to get advertisers in the door by claiming they had the largest audience). However, with the recent rise in ad or sponsorship deals based on time (such as “be our sponsor for a month”), it could raise some problems. With all the fuss about how online media is back thanks to advertising, it’s worth remembering that the ad market is cyclical, and a big scandal over highly inflated traffic numbers could torpedo the ad sales of some sites pretty quickly.