Posted by If there’s one conversation happening around the water cooler right now, it is how to figure out what’s working in terms of marketing your business, how to measure it, and how to make it work even more efficiently.
This talk is taking place because, historically, all marketing and communications measurement has been, to some degree, highly subjective. Yes, volumes have been written about the true science behind measuring the effectiveness of a marketing campaign. We even use science-sounding terms like GRP. (I won’t bore you with the longer definition, but it stands for Gross Rating Point and is supposed to represent the percentage of the target audience reached by an advertisement.) As accurate as some of these measurements are for traditional marketing, the real win behind doing anything online is that everything is measurable. Highly measurable.
Real measurability (the ability to not only know how many people saw an ad, but know who went to a website, clicked a link, gave some information, purchased something, or left without doing anything) makes online one of the most amazing marketing opportunities in the world – and also one of the scariest.
What could be scary about knowing the actual outcomes of all of your online marketing initiatives? Well, the truth, for one. Over the years, marketers have fed one another so much bunk about viewers and what they do in traditional mass media, that the truth behind the perceived reality can leave quite the sting.
The other scary part about understanding the real measurement surrounding your campaigns is that it sounds complex, technical, and, well … nerdy. When I say, "web analytics," you probably think, "boring." Thankfully, it isn’t. In the past couple of years there have been some very innovative developments in the arena of web analytics that has democratized the process. In fact, you don’t have to have any serious level of technical know-how to use, understand and learn from web analytics. In the past, understanding what people were doing online was very complex. The information resided in data logs that had to be pulled and manipulated by people in the IT department. Companies like Omniture, WebTrends and Coremetrics then came along with better dashboards and robust technical infrastructures so that some of the bigger websites could really see what was happening with their online activity.
In the past couple of years, web analytics has really opened up to the general population.
One of the well-known ways to get this information is Google Analytics. It is totally free, and provides tons of rich data in a way that anyone can understand. Yahoo! also has a great (and free) web package called, Yahoo Web Analytics. By just adding a simple line of code to your corporate website, you can begin to see, hear and practically feel what people like, dislike, love or hate about everything you are doing online. From the business side, Google and Yahoo web analytics both provide an easy-to-navigate environment with some stunning visualizations of your data. Wouldn’t you just love to know what days of the week bring your website the most traffic, or where the majority of visitors come from? What about knowing which keywords people use in search engines to find you, or which others sites send the most traffic your way?
"Web analytics is sexy," says Avinash Kaushik, who is the author of the best-selling book Web Analytics – An Hour A Day and a blogger over at Occam’s Razor.
Kaushik is one of my favourite marketing minds (just take a listen to the conversation we had together this past week: SPOS #152 – Six Pixels Of Separation – The Twist Image Podcast – +1 (206) 666-6056 – Orgasmic Digital Marketing Avinash Kaushik). While others focus on colours and creativity, Kaushik is all about letting the general public decide what types of online marketing works by voting with their mouse. One of the more important metrics to consider is something called the "bounce rate" – the percentage of your total traffic that arrived at your website, did not click on anything, and left (or, as Kaushik describes it: "I came. I puked. I left."). The sad reality is that the majority of corporate websites have a high bounce rate. This means that visitors found your site though a search engine, clicked on a search result, arrived at your website, but did not find what they were looking for. Kaushik calls this a "crime against humanity." That might sound a little dramatic, but imagine the potential business that is finding you and then leaving before you can convert it into dollars.
Newer services such as Compete.com allow you to even see the analytics on other people’s sites (including your competitors). While some of the basic functionality is free, there is a paid model that offers a much deeper experience.
Ultimately, you are responsible for how your clients (or potential clients) engage with you online. You can choose to ignore your web analytics, or you can embrace the information that is available to you to not only look at how many people are coming through, but what they are doing and how you can better adjust your website to meet their needs and make things click.
That doesn’t sound very nerdy all. In fact, it sounds like smart business.
The above posting is my twice-monthly column for the Montreal Gazette and Vancouver Sun newspapers called, New Business – Six Pixels of Separation. I cross-post it here with all the links and tags for your reading pleasure, but you can check out the original versions online here:
– Vancouver Sun – What’s working and what isn’t is right at your fingertips.
– Montreal Gazette – Everything online is highly measurable – so much so it’s scary.
Never another podcast episode or article 
Mitch,
Lots of companies are measuring today. However, they suffer with organizational digestive problems around web metrics.
Avinash talks about data puking, that is when analysts vomit all this data on other members of the organization and it is unappealing. They also suffer from data diarrhea. Data goes through the organization but flows right out as nothing gets absorbed. I believe this is the bigger problem.
Organizations believe they are doing web analytics because they have all this data, but the organizational body doesn’t do anything with it and can’t take any action. This is poor business nourishment. Having web data isn’t about collecting information and distributing reports, it is about making smart business decisions and continuous improvement.
Bryan
I have to agree that organizations who are suddenly exposed to all this valuable information may not know what to do with it. In fact, it is a language that not too many people outside of the professional analytics world know how to speak and understand. The learning curve is quite steep. But the bottom line and ultimate point is that the data is available and once the analytics’ equivelent to Imodium is widely available, organizations won’t be running for the washroom so much.
Compete.com is not yet a valid instrument. I compared its data with some real report and found really far from reality.
Bounce rates are overrated. It’s a flawed calculation.
All statistical web data is only valuable relative to the rest of the data. No one category or number can be taken for merit on it’s own.
Great comments Bryan. “smart business decisions and continuous improvement” doesn’t take a rocket science degree to implement. There are some concrete steps one can take to get this working. Bryan talks about it, Avinash talks about it, we talk about it.
How often we forget that we must be goal oriented. “What’s important to my business. What gets us there? What do we need to measure to figure out if it’s working? What can we change? What do we need to keep track of to ensure that we’re succesful?”.
We’re about to publish a book on this subject, and hope that it will demystify (hat tip to you, Eric) the experience.
Well done, Mitch. Great post!
Sitting/reading through presentations pages of data only to ask “so what?” at the end, does beg for a good summary…Over the past few years, I have seen a shift from a “traffic volume/open rate” conversation to one that involves goal setting, the expected outcome, and analysis required during a campaign. Now, it’s not just a customer who arrives, but what they are saying and doing, and how every step of the way. The most gratifying experience is having marketers use analytics to influence their decision making as a campaign is in progress and shifting course to respond to and align with customer behaviour. Companies (Eloqua comes to mind) with services to track “digital body language” and mkt solutions in response to a customer’s needs/requests etc. are becoming more common. Interesting stuff, looking forward to seeing the evolution.
I read the part about compete.com with great interest. I did not know of its existence. But then I read a comment detracting from its performance.
Mitch I think you need to post a comment on this.
Re: Compete.com – we have found the data very interesting. In particular for comparing sites to one another. Is it going to return the exact same results are you own web analytics package? We’ve seen instances where it is close enough. Your mileage may vary.
Re: Bounce rates – they are not for everyone (news sites – for example – sometimes don’t get people to click because they simply read the news item and then leave. In that instance you may want to focus more on time-spent and repeat visits). Again, knowing your strategy will give you the direction for what to measure.
Hey Mitch!
Great post. In reference to…
“By just adding a simple line of code to your corporate website, you can begin to see, hear and practically feel what people like, dislike, love or hate about everything you are doing online.”
I’m not sure how you get that from these tools. Tools like the ones you are listing are great at telling you ‘WHAT’ people are doing on your website. The ‘WHY’ however can only come from customer feedback (Voice of Customer). Getting into the hearts and minds of website visitors is not something that can be done through traditional web analytic / clickstream solutions.
I totally agree with the importance of the tools, I am just not sure I agree with the level of insights you state these tools will yield.
I think one of the larger problems with web analytic reporting today isn’t that there are enough metrics but TOO MANY metrics like Bryan commented. The other problem is that the team reporting metrics to business often include metrics that would mean nothing to a business. The most effective metrics I’ve found are actionable metrics and those tied to ROI, and the metrics all need to be prefaced with some plain old English aimed at your audience. Actionable metrics typically mean reporting on things that are doing poorly (figure out why they are doing poorly) and then the other end of the spectrum, anything that has a significant year over year or month over month increase, as those are indicators that something is working well and may be applied to other parts of your website. ROI is good because it grabs the attention of your audience, and people pay attention to anything that talks about dollars and cents. If you can show a 1% increase in conversion will add another million dollars to the bottom line people will take action on figuring out what needs to be done to move the bar.
Secondly I think there are web metrics that need to be reported just to your web team, and this is a metric that a lot of people overlook. These metrics are what help your web team articulate to the business the driving forces of what is happening on your site. You may not want to show your business a complex pathing report but as the team responsible for site health they should all understand what it means, and how to manipulate that funnel. Also stuff like your 404 report may not mean anything to the business side, but knowing what customers are seeing as a 404 you can then setup a redirect on your top error pages to get a customer to an experience more likely to convert. I get into more on this over on my blog at gabmonkey.com.