What Is Web Analytics And Why Is It Crucial To The Retail Industry?

By John Harrison, CEO of eVisitAnalyst.com

Web Analytics may sound like something your IT department should deal with but it is in fact a key part of online marketing. Its primary function is measuring how well a web site is doing its job. The retail industry is investing more money on great looking web sites, offering a full online shopping experience. This is a crucial part of the business and an extension of the brand. But are they working?

Measuring things is boring, but the interesting part is when you measure behaviour and try to serve up dynamic online content to take advantage of your new knowledge. For instance should you offer ìjobs in ITî or ìIT vacanciesî? It means the same but which phrasing do people respond to? Web analytics is about measuring whether your online business is working.

To say ìMy website has 2 million visitors on any given Fridayî is interesting but not useful. You need to know what they are doing there.


So how does web analytics fit with your Search Engine Marketing Campaign?

One characteristic of the new era following the dot.com boom at the turn of the century has been the inexorable rise of search engine marketing (SEM) as a component of the online marketing mix. Its significance is confirmed by the ever-increasing amount of money being spent on SEM as businesses understand the importance of getting their web site and their services high on the search engine rankings as people search for information or products and services offered by charities.

Confirmation that this is a booming area of activity can not only be seen by the growth of the more successful search engines, as demonstrated by the recent Google float and accompanying increase in share price since, but also by the plethora of SEM boutique agencies which have sprung up to help on- line marketing managers deal with the art of successful SEM.

With the increasing amount of money being spent on SEM, online marketing managers are looking to their website analytics providers to show them a clearer picture of whether their expenditure is delivering the goods.

The web analytic vendors, ever keen to satisfy the demands of their customers, are attempting to provide some much needed science to this area, although there are many who would state that website analytics is as much an art as a science.

Any half decent website analytics offering can provide support for online marketing campaigns such as banner advertising, email and so on, and SEM can be treated by most website analytics systems as another online marketing campaign.

Job done? No, not quite! SEM has its own special demands on website analytics, and their users, and website analytics vendors need to address these.

The magic metric in assessing the success of any online marketing campaign is return on investment (ROI). Website analytics vendors will drone on about how their offering will provide online marketing ROI during their sales pitches. So much so that you could organise a sweep with your colleagues: How many minutes into their presentations before ROI is mentioned?

There are a number of website analytics solutions that can track return in terms of the jobs filled from online enquiries. This in my opinion is too simplistic because it does not reflect true profitability. Furthermore, the end objective of a lot of websites is not exclusively filling vacancies. The website may be designed to drive calls to an agency or offer advice and help. Website analytics vendors need to raise their game to provide solutions that can work with these websites and their SEM.

In all the excitement surrounding SEM, its little sister, search engine optimisation (SEO), is often overlooked. Here a website appears within search engine results due to its content rather than due to paid positioning. This natural traffic can be improved by optimising the website for search engines. The more savvy agencies are switched on to this and promote SEO as complimentary to SEM. From a web analytics point of view it is important to be able to separate traffic originating between the two, as the costs are different. SEO is free (apart from the agency cost!) and SEM is paid for.

The good news for online marketers is that SEM is very important to website analytics vendors. SEM features are already available from some website analytic vendors and is pretty high on the to-do list of the others. I expect a raft of announcements on this subject in the near future. That website analytics is important to search engines can be seen by Googleís recent purchase of website analytic vendor Urchin. I wouldnít be at all surprised to see some more announcements in this area either.

So, just before you go dashing off to shove a purchase order under the nose of your boss to get his autograph for your web site analytics there are some important factors to consider. With the plethora of website analytics vendors available it is likely that more than one system will meet most of your requirements.

Having looked at the products you now need to look at the vendors themselves. Surprisingly you will find more variation amongst the vendors than you will in their products. They vary from huge American global corporations to smaller UK companies Ö but bigger does not necessarily mean better.

Consider other important factors like customer support and a flexible approach. Customer support should not be a profit centre for a vendor, in fact the organisation should be built around it.

So you can decide whether you want your technical support delivered from an email address on the US west coast or at the end of a phone or even on site from the developers in the UK.

Finally, and surprisingly, cost is not as an important issue as may be thought.

The market is divided up into three distinct groups. At the bottom are the free or low cost self serve solutions. Fine for the local cricket club website but not recommended for anything more advanced.

At the other end of the market are the big-ticket solutions which tend to differ from the mid range group mostly in depth of data analysis, but a number of the mid range vendors are catching up fast.

Although comparing like for like can need a bit of dissection ie does the price include set-up, training and consultancy; most of the mid range solutions are priced remarkably similarly Ö or can be made to be with a bit of negotiation.

In any case you should not be focussing so much on the absolute cost but the added value your web analytics investment can give you. As website analytics vendors keep telling us: ëIts all about Return On Investmentí.

What is an important issue is contract period. Outright purchase or a long term ASP or rental deal commits you for a long period. Keeping the vendors on a short leash with a short cancellation period ASP or rental deal will keep them on their toes and gives you the reassurance that if they donít deliver you can move on without a major loss of investment.

Purchasers often ask for free trials and we do oblige with these requests but it normally takes longer than a standard 30 free day trial period to determine whether the solution is the right one. I would recommend choosing a system as discussed above and negotiate a short notice break clause for an ASP or rental deal. You can always renegotiate a longer-term or outright purchase deal later once you are fully satisfied that you have made the right choice. And if your choice of vendor doesnít seem keen on this then just remind them of the competition out there.

So if you sort out your requirements before talking to the website analytics vendors, look at the vendors as well as their products and start on a short term deal you shouldnít go far wrong