Web Analytics: Measuring and Improving Your Site - Constantly
As Robert Burns wrote, “the best-laid plans of mice and men often go awry,” and in the world of online business, this old axiom rings especially true. To ensure your best-laid online business plans do not go awry, you need a proper web analytics program to help you ride herd on your business metrics and beat your competition.
Luckily for you, the Internet is awash in measurable data; much of it real time data. For web-based businesses, collecting data is not difficult—but reams of raw data does not a proper web analytics program make. Generally speaking, a good web analytics program—one that helps you succeed online—consists of five elements. You must collect the right business data; you must present it in a meaningful way; you must analyze it properly; you must use the data to optimize your business strategies; and you must use the data to innovate—continually.
Only Measure What You Can Use
The Internet is a sea of information; with that information comes enough raw data to fill the sea several times over. Because so much data is available—at your fingertips, no less—it’s difficult to make sense of it all. Moreover, often it’s difficult to determine if you collected the right data in the first place.
To avoid data overload, begin by focusing on Key Performance Indicators (KPI)—those metrics that measure impact on your key business objectives. Then, narrow the scope even further: focus only on those KPIs that give you actionable information. Information you cannot act upon will not help you grow your business.
Once you determine the KPIs that give you the best actionable information, establish measurable business goals. With good, measurable metrics and clearly articulated business goals, you should be able to see how you’re doing by measuring your performance against those goals—and current performance versus past performance—at any point in time.
Report Your Findings—Clearly and Succinctly
Business does not occur in a vacuum; you will not achieve your business goals without help from others. So don’t keep the valuable business intelligence you gather to yourself—report it to others, often, so that everyone on your team stays on the same page.
When you report your findings, don’t be ambiguous—leave nothing open to interpretation. The best tool for reporting business intelligence is the business dashboard—a simple, easy to read, easy to understand visual data display, often in real time. The best business dashboards present data comparatively, as standalone data is rarely useful.
Your business dashboards should make extensive use of filters and alerts. Filters help ensure your reporting contains relevant, actionable data in the proper context. Alerts—email alerts, text message alerts, and others—help ensure information is pushed out to those who need it automatically, whenever they need it, so immediate action can be taken.
Analyze Your Findings
You went through the time and trouble to collect this valuable information, now make it work for you by analyzing it. More specifically, analyze it in the proper context—as compared to your Return on Investment (ROI).
Successful online businesses are able to gauge the ROI of each and every business initiative. This allows them to reallocate investment dollars and realign business tactics quickly and accurately. With the proper metrics, and the best reporting tools—business dashboards—you should be able to tell, at a glance, how a particular investment, like an advertising campaign or a special promotion, is affecting your ROI. Moreover, you should be able to determine the value of specific online content in meeting your ROI.
Make Use of Your Analysis
One of the best attributes of doing business online is the ability to make on-the-fly adjustments to your business tactics for little cost. Use your analysis to make cut-and-dried business decisions, but don’t be afraid to test in order to find out what works and what does not. To be successful, you must use your analysis to test, and then optimize, every element of your business program.
Multivariate testing, in which one or more components of your site are tested in a live environment, can help you attribute gains or losses in your key metrics to the proper variables. Generally speaking, you should test a small portion of your incoming traffic by directing them to the changes you wish to test, while minimizing the risk to the remaining incoming traffic by directing them to the “control” portion of your site. Of those being tested, most of your efforts should be geared towards trying to “beat” the control group by improving existing variables.
Don’t Rest on Your Laurels
While a vigorous testing program can help you determine what works and doesn’t work now, it can also direct you towards what may work—and what may not work—in the future. Remember, the online world is evolving rapidly; what resonates with your users now might not resonate with them tomorrow.
To ensure your business remains viable for the long term, you must be willing to embrace risk. But don’t just take shots in the dark; use the data you gathered and the analysis you performed to inform the risk you are willing to take. Think about the things that work well for you now, and use the business intelligence you gathered to come up with ways to make them work even better. Can a process or transaction be streamlined? Can a labor-intensive procedure be automated? Will static content areas be more useful if you can make them dynamic instead? Use what you know to make informed choices; keep the pipeline full of fresh, innovative ideas—and don’t be afraid to test them. After all, those who risk the most usually stand to gain the most.
Finally
A good web analytics program is crucial for online success, but a good web analytics program consists of more than just the ability to collect reams and reams of data. In order to help you be successful online, your web analytics program should collect clear, actionable data; report that data in meaningful, unambiguous ways; allow for vigorous comparative analysis to your ROI for specific business initiatives; provide you with the ability to test results against isolated variables; and help you innovate for the future. With a good web analytics program in place, you will be well-positioned to beat your competitors and make your business the best-in-class on the web.
By Robert Pothier