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Om Malik has a great post up titled Alexa can be injurious to your wealth that describes a number of flaws with Alexa as a ranking of a web-based service. I have never taken Alexa data very seriously – while Om points out some flaws there are lots of others that anyone with a basic understanding of web analytics will be able to determine quickly. While it’s potentially useful for either long term trends or very rapid variance effects (e.g. The First 25,000 Users Are Irrelevant problem or – as Josh Kopelman more succinctly put it – 53,651) I’m always very careful about how I interpret the data (and I usually don’t give it much weight.)
Om’s parting comment is “In closing, if you are a startup that brings up your Alexa ranking in a meeting with us and tout that as your shining achievement, it would be time for my smoke break!” I couldn’t agree more (even though I don’t smoke – how about “it’s time for my treadputer break.”) I don’t want to hear about your Alexa ranking – I want to hear about what your users are really doing, how much they are actually using things, and what drives increased adoption.