by Google

Most businesses know how many web visitors they receive and the number of sales/ leads generated from them. However it is still amazing that woefully poor conversion rates are accepted as being the norm for conducting business online.

With a clear understanding of how you acquire visitors, the resulting user experience, conversion rate and ROI, you can not only benchmark specific marketing strategies, but also dramatically improve your bottom line.

Put simply, this is what web analytics tools can do for your business. Example vendors include Webtrends, Omniture, Visual Sciences, IndexTools, Nedstat and Google Analytics.

What can be measured?

The field of web analytics has come a long way in recent years. What used to be a technical subject for tracking server performance, error pages and hits, has evolved into a marketer’s dream. There are different conversion metrics and user pathways (the journey a user takes as they click from one web page to another) available that can be cross referenced by other data such as the visitors’ geographic location, or which search engine and keyword they used to arrive on your site.

How to implement web analytics

Today web analytics tools are easier to implement than ever before. Rather that analysing logfiles, setup can now be as simple as adding a couple of lines of hidden code to your web pages – usually javascript. This code simply streams visitor data to collection servers at your provider and you login via a web interface to view your reports.

Of course, collecting the data is only the first step of improving your web site performance. Adjusting your configuration to track events, goals and funnel paths is where you will gain the greatest insights.

Privacy obligations

As a web site owner you have obligations when it comes to protecting the privacy of your website visitors. In the European Union it is a legal requirement that you inform your visitors if they are being tracked in your privacy policy.

How much resource should I spend on this?

Before investing in web analytics, estimate the value that it can bring to your business. Typically improving your conversion rate by one percentage point is a good starter. If this increase is worth £1,000’s per year to you, then clearly this is the potential budget that can be dedicated to web analytics.

The key however, is not to spend your analytics budget just on a reporting tool, as no web analytics tool can optimise your web site/marketing campaigns for you. That requires smart people who interpret the data and provide an action plan.

So think of investing the majority of your web analytics budget into the analysis of your data. This can be the hiring of a professional, the training of existing staff, or a combination of both - it is these people that will identify and implement that one percentage point growth, not the tool itself.