NetRatings: Valuing Internet Stocks Using IQ
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Holmes Report

NetRatings: Valuing Internet Stocks Using IQ

We were retained to develop a brand awareness program targeted specifically at financial analysts (key endorsers of the data) to break Media Metrix's 'monopoly' and to gain more clients as a result.

Paul Holmes

In October 1998 Nielsen Media Research and NetRatings, Inc. formed a strategic alliance to develop the Nielsen//NetRatings Internet audience measurement service.  Combining Nielsen's 50 years of best practices in audience research with the most advanced Internet measurement technology from NetRatings, the service was anticipated to be unbeatable.  Except one thing … Media Metrix, the existing market leader, had first mover advantage and those who used the data for years in their financial models were reluctant to abandon it.  When the company went public in December 1999, NetRatings hired our parent company, BSMG Worldwide, to conduct a media and PR program to encourage mentions in the press.  We were retained to develop a separate brand awareness program targeted specifically at financial analysts (key endorsers of the data) to break Media Metrix's 'monopoly' and to gain more clients as a result.


Supporting the global marketing team, FRB's objectives were five-fold:

  • To increase awareness of Nielsen//NetRatings as an alternative to Media Metrix among analysts and investors who are likely to find NetRatings' Internet audience research useful in their evaluation of investments. 
  • To encourage use of Nielsen//NetRatings products by actively communicating the key differences and benefits of its data over currently available alternatives. 
  • To encourage third-party endorsement of NetRatings' data by key analysts within the investment community.  By citing Nielsen//NetRatings as a source of data in research reports, speeches and interviews, analysts could widen NetRatings' pool of potential customers as well as validate the quality and reliability of the data. 
  • To establish key spokespeople within NetRatings as authorities on Internet usage and key trends in the industry. 
  • To solicit feedback regarding the data (quality, timeliness, presentation, delivery mechanism, perceived valued added, etc.)  This feedback provides additional qualitative information that can be used to identify specific needs and requirements of key user audiences within the investment community.


Our primary audience consisted of influential analysts and buy-side investors.  Based on the areas upon which NetRatings reports, we further narrowed our targets by industry segment, such as consumer products, retail, Internet, technology, finance, media, advertising, etc.  Utilizing our proprietary database of more than 50,000 professional investors, we created lists for various events as well as those interested in receiving the monthly data and financial newsletter on an ongoing basis. To deliver time-sensitive market data, we created lists of analysts covering the top 50 Internet properties for a special quarterly earnings alert campaign quarterly, which we conducted by email.   On a regular basis, we also delivered contact reports with whatever qualitative feedback we were able to obtain.  


Prior to developing this program, we polled 30 of the 106 analysts that attended NetRatings' first event in New York in January 2000.  Through telephone interview, we garnered feedback concerning this market segment's familiarity and perception of Nielsen//NetRatings, how their data compares to the market leader's, Media Metrix's, and what information about the company or data would be relevant to their analysis of the Internet industry.  We also asked analysts how they wanted to be reached in the future (frequency, format, length) and what type of content and depth would be useful.  With those already subscribed to the service, we helped NetRatings identify user concerns and opportunities for new product offerings.  For those who were 'on the fence,' we delved into barriers.


Marketing to Wall Street analysts represented more of a challenge than to the average consumer. In addition to having higher information needs, this audience tended to view any self-promotion as suspicious.  Therefore, we determined that we needed to refine NetRatings' approach by organizing focused, thematic events tailored specifically to the analyst's needs and by continually taking the pulse of the market and analysts' concerns.  We designed a program whereby NetRatings would educate analysts about consumer demographics and behavior online and the tools available to study it.  In scheduling these events prior to earnings cycles and around newsworthy subjects, we were able to get and maintain the interest of these busy professionals.  Once we had their attention, we encouraged NetRatings to educate them about methodology, data discrepancies as well as their products and services.


Competition for analysts' time is keen.  Therefore, we had to first convince management that the commitment to developing compelling content would be critical to a successful program, which included:

Hosting regular conference calls on Internet trends: We focused NetRatings on delivering content broad enough to generate interest among a variety of industry analysts, such as differences in work versus home traffic online, but with case studies that would specifically showcase the range of NetRatings' analytical abilities.  Rather than reiterating data press releases, we also encouraged NetRatings' own analysts to do more than interpret historical trends.  We wanted them to be 'out front' and bold about making projections on future spending and usage patterns as well.

Organizing quarterly meetings to discuss data and meet the analysts (Wall Street's and NetRatings'): We invited opportunities to interact with analysts.  Meetings not only provide salespeople a chance to put a 'name to a face', it also gives management time to discuss its strategic developments.  During our May meeting, we set up computer terminals to give attendees an opportunity to have a hands-on demo.  To increase participation, we made these meetings available via video simulcast over the Internet.

Sponsoring industry-specific webcasts on industry issues that matter: Immediately following the dot-com crash of April 2000, we organized a special analyst panel to discuss the market  and how to evaluate Internet companies, using NetRatings' and other financial metrics.   At a time when the market truly needed guidance from its luminaries, this program successfully spoke to the investment community's needs and raised NetRatings' visibility as a leader in Internet research.

Continuing the buzz on a monthly basis with the use of information teasers: To avoid duplicating the company's salesforce's efforts, we prospected new analysts by delivering information.  Our "hook" was to tease with access to NetRatings' monthly data, conference calls, quarterly events, newsletter and snapshots, and our goal was to create a continuous flow of information to guide the company's communications as well new product initiatives.  

Spawning controversy by providing comparison data ahead of time and free to specific analysts

To encourage the publication of NetRatings' data, we delivered data snapshots of the top 50 Internet properties by email to the analysts that cover them.  During mergers and acquistions, we delivered lists to their salesforce who sent ad hoc market commentary, using their data, to the sell-side analysts and top investors of the companies concerned.  These activities generated discussion for sales and FRB, and fueled the ongoing controversy between Media Metrix' and NetRatings' data.

Reinforcing it all in a monthly financial E-letter: To bring all these activities full circle, we summarized NetRatings' findings, trend calls, developments and methodological issues in a newsletter that we circulated monthly via email.  


In every month, except April, NetRatings was quoted significantly more than Media Metrix (increased usage).

FRB organized three thematic conference calls, two analyst meetings and a special webcast on valuing Internet stocks.  As a result, over 2,025 analysts participated in our events (increased awareness).

In our first analyst meeting, at least nine of the 30 companies we spoke with immediately requested an in-house meeting and trial memberships (lead generation).

Analyst report mentions increased to 2,475 in a nine month period (increased usage).

Several influential investment firms signed on as customers, including Goldman Sachs, Deutsche Banc.Alex Brown, J.P. Morgan, Bear Stearns, Jefferies & Company (key client wins).

Both Goldman Sachs and Bear Stearns published independent research reports explaining their decision to use Nielsen//NetRatings data for their Internet research (third party endorsement),

Over thirty-eight research firms quoted Nielsen//NetRatings data (gaining acceptance, third part endorsement),

Endorsement by financial analysts increased media hits (additional third party endorsement).

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