The relentless rise of online research -

the more internet penetration grows.

But opportunities lie in the rapid growth in the number of clients -

from dotcom start-ups and clicks-and-mortar corporations to ISPs and

online advertisers - who all need intelligence on the effectiveness of

their online marketing.

Not surprisingly, all of the leading market research groups now offer

in-ternet research of one kind or another. MORI, for example set up a

specialist new media division, e-MORI, in 1996, which has tripled in

size by 1999.

The first battleground is audience measurement. Here, rival groups are

preparing to slug it out globally - among them the world’s biggest

market research company, AC Nielsen.

’We’re seeing an explosive growth in the size of the internet

population,’ says Nielsen NetRatings sales and marketing director John

Purcell. ’We have to match that with good, concise information. It’s

crucial for clients to understand audiences.’

Nielsen has built up a 9000-strong panel in the UK (90,000 worldwide,

and growing fast) of internet users who have special software loaded on

to their PCs that records every web page they visit.

Greater transparency

The data is analysed by Nielsen and made available to clients via the

internet. Clients, adds Purcell, are surprised at how much transparency

this system brings to web traffic patterns.

Pitched against Nielsen in the audience measurement market are MMXI and

NetValue. The former is a joint venture between Media Metrix of the US,

which has been involved in internet audience measurement since 1996, and

European research companies IPSOS, GfK and Sifo. MMXI has 3000-strong

panels in the UK, Germany and France, and aims to boost these to 10,000

participants in each country in the coming months.

In February, Media Metrix announced a strategic research alliance with

global management consulting firm McKinsey & Company, to develop a

deeper understanding of online consumer behaviour and its implications

for e-businesses.

French-owned NetValue has forged an alliance with market research giant

Taylor Nelson Sofres, with a view to defining internet panels consistent

with the standards of TV panels.

Taylor Nelson Sofres is also supplying NetValue with regular internet

’universe estimates’ to provide clients with a clearer picture of how

representative a panel is of each national population as a whole.

NetValue currently measures internet usage in the UK, France, Germany

and the US, and claims it will expand into ten more countries this

year.

There is also a great deal of research that does not require such heavy

investment. Ad hoc quantitative surveys can be carried out fairly easily

by using pop-up windows on web sites, and this has brought about a lot

of competition.

’Inevitably with internet research a lot of small start-ups have got in

quickly. The big groups have been a little slow getting involved. But a

lot of research buyers want to go with the big guys who have global

exposure,’ says Ian Wright, director of interactive research at

IPSOS-RSL.

IPSOS-RSL offers clients WebCheck, a quantitative online research

product using pop-up windows, as well as qualitative research into web

site navigation. Wright’s concern, however, is that the very ease and

simplicity of data-capture on the internet may spawn research of dubious

quality.

He adds: ’The internet is very attractive for clients because using it

for research massively reduces data collection costs, and it tends to be

quicker. It’s important to make sure you don’t get back a lot of

rubbish. The cheaper you make it, the more you may devalue your

research.’

Wright believes there is a real danger that the internet might reduce

the size of the market research industry, eventually to the detriment of

clients.

Yet, for the moment at least, most market research companies are happy

to ride the the internet wave. ’There’s no question that online research

has become our fastest growing area in the past year, and it will

continue to grow,’ says NOP brand development director Mike Cooke.

Data cappuccino

NOP is adopting a different approach from most of its rivals. It formed

a joint venture with the Internet Exchange chain of internet cafes,

allowing it to conduct market research in 90 UK cafes and a further 20

in Ireland.

’Isn’t it so much easier to bring people into a web-enabled area such as

a cafe where they can relax?’ argues Cooke.

The other advantage of this approach, he says, is consistency. As

internet users can have different computer hardware and software, the

way they receive web sites and advertising varies. By conducting

research on standardised machines, NOP and its clients can at least be

sure that each member of a sample is seeing things presented in a

uniform way.

Fergus Hampton, chief executive of media analysis and evaluation

consultancy Millward Brown Precis, thinks web brands will increasingly

want the flexibility to change or drop online campaigns fast. They also

want research into what is being said about them on the web. ’What

clients actually want to know is the impact of what is being said on

sales, brand and reputation,’ he says. ’But as an industry we’re a long

way off being able to tell clients anything useful about that. No one

has cracked internet media evaluation or analysis.’

NOP’s recent Euro.Net survey, found over nine million new internet users

across the UK, Germany and France in 1999, and this is projected to rise

to at least 52 million by the end of the year. That, plus the advent of

WAP phones and interactive TV will only fuel the need for reliable,

effective online market research.

PROS AND CONS OF INTERNET RESEARCH

Alex Johnston, technology and communications director for new media

research at Research International, looks at the pros and cons of

internet research.

ONLINE QUANTITATIVE RESEARCH

Benefits

- Inexpensive compared with traditional

- research methodologies

- Fast turnaround

- Automated data collection

- Can show graphics, sometimes video

- No interviewer bias in data

- Data quality (logic checks and in-depth open-ended answers)

- Seamless international co-ordination

Limitations

Respondent ’universe’

- Sampling issues: narrow target audience; difficult to identify;

understanding the sample

- Often self-completion based, therefore potentially self-selecting

- Technical problems

ONLINE QUALITATIVE RESEARCH

Benefits

- Slightly faster and cheaper than traditional focus groups

- Avoids dominance by ’loud’ personalities

- More client control

- Can show concepts or web sites

- Easier to recruit respondents

- Can be co-ordinated internationally and allows for mixed nationalities

Limitations

- Lose non-verbal elements of traditional focus groups

- Less useful for emotive issues

- Online moderation requires new skills

- Some respondents can be hampered by slow typing speeds

- Sampling issues: a narrow target audience can be tricky to identify;

can be difficult to understand the sample

- Technical problems