Getting Started With Online Marketing – Web Analytics – Part I

In continuation of my last post about Getting Started with Online Marketing, this post will start you on your way with web analytics.

First of all, what are "web analytics?" In simple terms, web analytics represent a methodology and a set of associated tools you employ to understand how your web site impacts your business. When used properly, web analytics can help optimize your web site to improve business performance.

Performing web analytics can be quite complex and for big ecommerce sites, it is. But two things you must know, even if you are a relatively small or new company, is that today, you have to have a basic understanding about how web analytics work, and there are some easy and free things you can do today…so that is where I will focus.

First of all, you need a tool to measure you web site’s performance. While there are many tools available, I suggest you start with either Google Analytics ( or Yahoo Web Analytics  (If you do keyword advertising, it makes sense to use the tool provided by your ad platform provider.) Both are free and both are very simple to deploy. Also, both companies provide a set of tutorials to get you started. While you are installing the tool, let’s get started with the actual process.

Analyzing your web site’s performance is a 5 step process; as follows:

  1. Define goals for what you want you web site to do (easier said than done)
  2. Define metrics for measuring these goals
  3. Collect data to understand the current situation
  4. Analyze the data
  5. Make changes and go back to Step 3 (Collect Data)

In this post, I will cover steps 1 and 2; the next post will look at how at collecting and analyzing data, as well as making changes to improve performance:

Step 1 – Defining Goals

Like every other marketing activity/tool/channel, your web site must demonstrably support the business or it is wasting valuable time and money. The only way to know how your web site is performing is to define goals and measure them.  Defining goals for a web site may seem like a new idea for many companies, so I suggest you start with simple ones. Goals will necessarily differ depending on your market, but here are some examples that can be translated into metrics and then measured:

  • Generate 20% of total revenue from online sales this year.
  • Reduce the amount customers spend on support sites by 15% this year (through better help, search, and content, not by making them call the help line…).
  • Sign up 20,000 volunteers for a non-profit campaign within 6 months
  • Get 5,000 people to download a demo product within the next 6 months
  • Find 250 qualified beta testers in the next 6 months for a next generation product.

Step 2 – Metrics

In this step, you break down web site performance to get an indication of whether you are on track to achieve your goals. I will use a "sales goal" as an example to show how this can be done. Like many things in marketing, there are many ways to "skin a cat" and this is just one example.

To achieve a level of sales, you need to create a sales funnel, which begins with a number of leads.  Let’s assume you already know the conversion figures for turning a lead into a sale. (If not, this would be a good starting exercise as well.).  What you need to do is to create a good set of qualified leads. Some relevant sales metrics that measure "lead interest," include the following:

·         Bounce rate – how many people left your site after viewing the first page – a high bounce rate usually means one of two things – the landing page is not effective or that there is a mismatch between the message on the landing page and the link that sent the person to your site. In either case, a high bounce rate means that you need to take action. A 20% bounce rate is pretty good; a 70% rate means you have trouble. More on that later.

·         Visitor Acquisition – this tells you how people reached your site; for example, how many people came directly to your site, reached you via a search engine, or were referred to you from a partner site. Knowing where visitors come from helps you figure out which marketing activities are effective.

·         Trends of basic parameters – presents trends of how many new visitors you had, how long they spent on your site, and how many pages they viewed per visit. Looking at these values over time gives you an idea about whether your online activity is improving or not. These metrics are particularly powerful when correlated with changes you made to your marketing program.

·         Search Analytics – if you run Search ads, you need to look at how your ads are performing. While Search ads analysis is not really "web analytics," I include it because it is very important.  You need to check your ad performance frequently, and evaluate the benefit vs. cost of each keyword. Also, one thing I caution is to measure how "search" vs. "content" ads stack up. You may be paying for ads that aren’t providing much value.

There is obviously a lot more than can be measured, but this is a good start.  Next post, we will look at what you can do with these metrics to improve your business.

Add New Comment


  • David Lavenda

    Yes, many web analytic tools tell you where web visitors come from. You can actually see the visitor's domain name. In the corporate world, this can be a great tool to see which companies you are attracting. In some cases, you will see the visitor's ISP domain and not the company domain - this happens a lot in Europe, for instance. However, you can still get some good information about whether you attracting the right kind of companies. If you had a discussion with someone in a company (of if you sent them mail) and then you see a web hit from that company, you have some indication that there was some follow up. On the other hand, at this level, in the consumer space, it is hard to use this information directly - it requires a bit more work.

  • Kain Latini

    I like to use analytics to understand my visitors. I want to know where they came from. With the information, I can add more resources to drive more visitors through that means.

  • David Lavenda

    indeed; the amount of potential data is daunting. That is why it is important to start small and get a feel for what you need to know. The few values I gave in the article should give you a high level view of how your site is doing.