Looking to add to your summertime reading list? I recommend the new report from Harvard Business School professors John Deighton and John Quelch and Hamilton Consultants, “Economic Value of the Advertising-Supported Internet Ecosystem” (full disclosure: John Deighton was my marketing professor). The report was created for the IAB to explain the online advertising sector to public policy makers, and literally calculates how much the Internet is worth to the U.S. economy.

In an attempt to solve this seemingly Sisyphean task, the report asserts that the Internet is simply worth what we pay for it, which is roughly equivalent to 2.1% of the U.S. gross domestic product. Due to the commercial diversity of the Internet and its far-reaching socioeconomic impact on American consumers, the authors rely on three different approaches to triangulate their answer:

1. From an Employment perspective (jobs created), the Internet is worth $300 billion;
2. From a Sector GDP perspective (money paid to the Internet sector), it’s worth $444 billion;
3. From an Attention perspective (consumer time online), it’s worth $680 billion.

As well-structured and comprehensive as this report is, I can’t help but conclude that it overlooks another valuable contribution the Internet has made to the economy: behavioral data as a source of consumer insight that can radically improve how companies go to market. Yes, I am probably biased because I am a market researcher (and an online market researcher to boot), but the lack of attribution to these Information/Insight benefits in the report’s value calculation certainly shortchanges the Internet. And, while I haven’t crunched the numbers, I’d assert that the information that the Web creates about consumers exceeds the commercial value of Internet advertising (nearly $25 billion in 2008). In other words, what we can learn about consumers’ digital behaviors is worth more than what companies pay to reach them online.

This may be a provocative view for publishers and their ad sales teams, but it should ring true for the rest of marketers. Part of the challenge is that digital data has been pigeon-holed as only useful for online advertising decisions: simple Internet audience measurement on one end, and highly addressable, behavioral targeting on the other. So as Internet marketing grew up, we became obsessed about the near-term impact of banner ads at the expense of more holistic Internet research. Many marketers, influenced by this CPA-mania, still view the Web as just a direct response medium and a cheaper channel for surveys. We now need to broaden the applications for digital research by measuring people and their behaviors, not just the ads. We have an opportunity to re-define what behavioral research is, so that marketers can more easily access and act on it.

To see what can we do with this new, combined data asset that we couldn’t do before, check out three ideas that can create new insights — and value — for marketers immediately, including Holistic Brand Trackers and Integrated Purchase Funnels, check out Compete’s monthly post on MediaPost.

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