[November 29, 2004]

The Resurgence of Web Analytics

By Brain Platz, Executive Vice President and General Manager, SilkRoad Technology

Web analytics is an effective yet underappreciated tool for organizations looking to wring the highest level of productivity out of their online operations.

The use of analytics packages has evolved over the years and is continuing to evolve. In the early ’90s corporate webmasters had rudimentary ways of tracking which pages users visited, how long they stayed on sites, and what sites they visited before. That led to more complex tools that steered users through sites more easily and enabled business managers to optimize sites as sales channels. Then, as the economy contracted, firms cut back on their use of analytics packages and focused their spending on core IT concerns.

Today, Web analytics is enjoying a resurgence as business managers are leveraging the power of their sites to drive sales and develop strategic initiatives.

One big reason for the renewed interest in analytics is the proliferation of tools that allow more people to post content on a corporate Web site. Modern tools make it easier than ever for nontechnical users to build, manage and deploy Web content and applications, thus freeing up IT staffers to concentrate on more pressing matters.

But as content is added and shuffled around, organizations are finding they need to continually evaluate whether their messages are getting through in the correct way. Web analytics programs not only can measure what content is being read; they can ferret out patterns that illuminate who’s reading the content, what they’re doing with the knowledge they gain and whether they might use the knowledge to, perhaps, make a buying decision.

Web analytics packages come in all sizes and price ranges, from free downloadable programs to $1 million-a-year leases for full enterprise-wide implementations. While different packages offer different advantages, businesses tend to look for Web analytics to shed light on the following central issues:  

• Top influencing factors to new customer acquisition
• Usage patterns by visitor demographics
• Reasons for drop-off during order execution or registration processes
• Customer value/retention metrics by visitor segment

The goal of any analytics package is to find out what kind of information is valuable to a user, so it can help drive him or her to an ultimate goal -- be it a purchase or an educational trip to additional content. By finding out what they’re reading, a company can invest more resources in similar content and strip out content that’s being ignored.

Web analytics also looks at behaviors: where people’s eyes are moving, and to what buttons. Perhaps you have a particularly important piece of corporate information you want people to see, but they’re not clicking to it. An analytics package can detect usage patterns a company can follow to guide a user toward that specific messaging document or demo that has proven to be a success in focused studies.

Analytics packages can help companies understand who their customers are. By setting up screening paths, a webmaster can categorize a financial services customer, for instance, into categories determining their net worth, risk tolerances, spending habits and interests. Using analytics, the company can slice up this data into reports and track click paths followed by particular groups. If investors with high-risk tolerances are generating 80 percent of a company’s profits, it may want to place targeted collateral along the trails these users tend to follow.

Demographic data and patterns also can be gleaned a number of ways. A site can set up a short survey. Or it can map back IP addresses or look for regional references buried in some of the user’s communications. Then, armed with demographic data, a program can match it up with behaviors and come up with some surprising patterns. Perhaps visitors from a certain country tend to click more on the left than the right. Perhaps a company’s targeted demographic gravitates more to an orange block of copy than a green one. The information culled may be whimsical and useless -- or it may reignite a sales campaign.

Analytics can tell a company that it’s appealing to a certain audience it had never targeted in the first place. Or it can link visitor clicks to sales data and find out which product is generating a higher percentage of sales per view.

Then there’s the ability to connect Web analytics directly to the heart of a company’s information storehouse -- its CRM systems. Using the business intelligence of the analytics package, the Web page can profile the user. But by identifying the online cruiser and cross-checking that person’s patterns with customer information the company already contains, the company can build stronger connections with its customer base.

Web analytics has been around awhile, but never before has it been seen as such an integral component of businesses’ strategies. By integrating a little intelligence into its Web operations, a company can learn more about its online guests and use that information to turn itself into a better host.