This toolbar is a tracking program that records the URL’s of all websites visited from that particular browser and transmits this information to Alexa, where it is then used to compute a ranking for each recorded site. This is known as a site’s “Alexa Rank”.

Why is a site’s Alexa rank important?
Forecasting the response rate to an ad on a particular website requires knowing how much traffic the site receives. In theory, Alexa’s rank does just that. It provides a statistical ‘best guess’ based on information from actual web surfers. Some pay-per-click networks offer Alexa’s information as a resource for assessing the relative strength of various websites in terms of traffic received.

Is Alexa accurate?
There has been some controversy over Alexa’s methodology. Some critics feel that too little is known about the size of the sample population from which the tracking information is obtained. There is also some question as to what extent the web surfing behavior of the sample population is representative of that of internet users in general. In theory, given a sample population that is both random enough in its distribution and large enough in size, there is the possibility that Alexa’s ranking system is accurate.

Alexa’s ranking system is probably best be viewed as just one of many tools available to internet advertisers.