Demystifying web analytics

It's easy, for example, to determine how many of your email marketing messages bounced back, or how many people your banner ad was served to and how many of them clicked through to your website.

These metrics are just the beginning as there are powerful web analytics tools that can help you to better understand exactly how your customers are interacting online with your business once they arrive at your website.

What is web analytics?
Web analytics is a category of business intelligence tools that helps you to understand the online behaviour of your customers and prospects. These tools allow marketers to understand and analyse their online marketing business from customer acquisition through to the reactivation of a dormant customer.

Web analytics draws on data such as web traffic reports, email response rates, direct mail campaign data, sales and lead information, and more, to create a picture of how customers are interacting with you online. It can give you insight into the key performance indicators (KPIs) that show whether your business and campaigns are meeting their goals.

Web analytics can help you to answer questions such as:

• Where are visitors to your website coming from - search engines, affiliates, banner ads, or email clickthroughs?
  
• Are you successfully attracting high-value customers to your website?
  
• What paths are visitors taking through your website? What do they seem to be looking for?
  
• Do your customers find what they're looking for on your website easily, or does it take them several clicks to get to the information or product that they're interested in?
  
• How often does a visitor come to your website before becoming a customer?
  
• Are customers abandoning their shopping carts before they check out, and which stage in the process do they give up on the transaction?
  
• Are you experiencing the level of traffic you expected after an offline or online advertising campaign?
  
• What calibre of visitor did the campaign bring to your website?
  
• Are you experiencing the level of repeat visits and purchases on your website that you'd like to?

The human element
There are a host of solutions on the market, ranging from entry-level solutions like Google Analytics, through to high-end suites such as Omniture SiteCatalyst. The more sophisticated tools allow for extremely complex and flexible analyses that embrace a range of variables. When choosing a solution, you should be looking for a suite that matches your business needs, yet offers easy deployment, flexibility and scalability to cater for growth and change in your business, and ease of use for the end-user community.

In a market that moves as fast as online marketing, you should seek out a vendor with an established track record and a healthy list of reference sites. Selecting the right technology is just the beginning; the real work lies in ensuring that the people who will work with the web analytics tool can derive the full benefit from it.

Although web analytics solutions can be automated to track and deliver data, it will be up to people to interpret the reports and use them to make business decisions. Configuring reports to deliver information relevant to your organisation's KPIs is critical to success.

The users who will engage with these reports need to be supported with training, internal adoption marketing and change management. End-users need to be educated about what web analytics can do so that they have realistic expectations. Some users may feel threatened by the introduction of web analytics. Having a powerful and influential user to champion the web analytics project may help to overcome internal resistance and thereby ensure a successful implementation.

Closing words
Web analytics allows you to turn data about your online customers and channels into knowledge, and to turn that knowledge into actionable information you can use to drive business benefit.

It means that managers and marketers are able to base marketing and business decisions on fact rather than intuition. Web analytics allows you to respond quickly to mistakes, threats and opportunities, so that you can meet your objectives and improve the performance of your business according to metrics such as customer conversion and retention.