Understanding Web Metrics and our Startup Indexes

Vancouver Blogger Darren Barefoot picked up on a great blog post this week by social news site Reddit that discourages marketers (or anybody else) from trusting web metrics companies like Quantcast, Alexa or Compete.

The publishers of the social news site Reddit provide further evidence of this phenomenon. They posted a screenshot from their Google Analytics account, indicating that their site typically receives about 8 million unique visitors a month.

They then compare these results with Compete (927,000 visitors), QuantCast (about 5 million) and Neilsen (625,000). Clearly none of these numbers are particularly useful to somebody trying to gauge the popularity or influence of a particular site.

It’s shameful how frequently the tech and marketing industries trust these sites. It’s a classic illustration of how people prefer highly dubious or inaccurate statistics over none at all.

I’m in full agreement with Barefoot and Reddit.  Metrics from Alexa and Compete are essentially a waste of time for marketers looking at the individual websites. However, in defense of our Startup Indexes, I do believe that they can serve a purpose when comparing multiple sites and SEO guru Vanessa Fox agrees:

All of the services are fairly notoriously unreliable. They all use different methods for gathering data that make them inaccurate by nature. Alexa, for instance, uses the Alexa Toolbar, which is skewed toward a certain user demographic. These tools are useful in a couple of ways, however: for trending over time and for comparisons. If you use one tool to gather data on these two things, then although the data will be unreliable, it should be equally unreliable over time or among sites, so the trending should be fairly accurate.

So while the actual Compete and Alexa ‘rankings’ may be meaningless, it is safe to say that Vancouver’s MetroLyrics is currently getting more traffic than Montreal’s Beyond the Rack.

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