While people are starting to do web analytics, almost no one is actually doing anything with the numbers. Learn from this web analytics consultant how to apply the findings.
Web analytics systems have been around for almost 10 years, yet the majority of online businesses fail to make use of them. It has only been in the last year or so that people have even felt the need to measure what is happening in their sites. My own research has led me to conclude that the most common reason people want web analytics today is not to improve their business, but to give their boss (or client) a report.
While people are starting to get the numbers, almost no one is actually doing anything about them. This was an issue much discussed at Jim Sterne's Emetrics Summits in 2005. By the 2006 summit most attendees expected things would have moved on, but we were all surprised to see that nothing had really changed a year later. In my view this is just plain nuts.
"Navigating by sight alone was adequate when man began sailing along the sea coasts, but once men set out across the oceans new tools were required to navigate successfully. Those without the right tools drowned."
-- Bryan Eisenberg, "The Guide to Web Analytics" (2002, Future Now, Inc.)
During the early stages of development, the emphasis in web analytics was on "actionable metrics," numbers which we could use. Network engineers built early web analytics systems, and these systems swamped marketing and sales people with useless information.
Those days are gone. Most web analytics systems today will focus attention on the key business metrics and present them in an easy-to-understand format. However, it's not enough just to have the numbers. We have to use them. On the other hand, in order to use them, people have to know how to use them.
What's the web all about?
Knowing how to improve online performance requires a clear understanding of what's going on in the web.
First and foremost we need to understand what the web is about. Please read this carefully: People click on words.
That's the essence of the web. Flash, banners, graphics, page design; these are all enhancements designed to encourage people to click on words (hyperlinks). Online sales and marketing is little more than a set of processes aimed at getting people to the ultimate click-- the "submit" button on the credit card processing form.
Web analytics systems tell us what's being clicked on and who's doing the clicking. Our job is to work out why and what to do about it.
In order to understand what web metrics mean we need to understand the processes our visitors move through during an online sale. First people have to discover our site. When they arrive they briefly scan the site to see if it's what they're looking for. If it is they interact with it (read pages, click links, use search facilities). Finally, if we're lucky, they will convert into a sale (this is called an "acquisition").
These four phases of discovery, scanning, interaction and acquisition are covered in more detail in my article "Framework for Performance Assessment." Each phase can be analyzed for costs, returns and performance. Multiple metrics are available to assess each phase, and these can be used to improve the performance of that particular phase.
A website is not a thing
The critical fact to bear in mind throughout all of this is that these phases all consist of the same thing-- presenting a series of web pages to someone. It's not possible to get a sale with a single page. When someone has finished looking at one page they have to decide whether to click on a (single) hyperlink in that page or leave. They can't click multiple hyperlinks, and they can't sit there passively forever. They must actively choose one action. They must exercise choice.
A website is composed of web pages. On each page the visitor makes a conscious decision whether to click or leave. Each page is thus a sales pitch, and every page view ends in success or failure. People do not come to your website-- they come to your pages. They will probably not see all of the site, and they can move from one site to another without noticing if you design it that way. Thus a website is an abstract concept.
It's fine to fiddle with ads, tuning delivery and audience mix, but this is of little use if the site is letting you down. Having a great website is the secret to a successful online business. The best ads in the world will achieve nothing if people won't enter the site.
Next: Why you need to analyze page by page, and how to leverage the greatest effect for the least effort.