It only measures visitors with the Alexa Toolbar installed and the cookies allowed. Alexa ranking is fairly easily manipulated so generally isn't considered accurate.
PayPerPost.com, Text-Link-Ads.com, and others value it because the buyers of their services consider the Alexa rank in how much the would pay.
I have also noticed Alexa has been way off on our web pages rank. I bet this has to do with the lack of users using the Alexa Tool bar and the website not getting enough data collected.