• by Jim Sterne , January 17, 2008

I was dead wrong about Web analytics. I wondered why companies had not invested heavily and speedily in education, training and Web analytics tools. Measuring the success of your Web site is a fundamentally obvious opportunity to blow away the competition. Why would any company not  want to set upon a course of continuous improvement? Why would any company turn down the opportunity to get a higher return on their Internet investment? Who would not want to optimize their online marketing, thereby boosting their return on investment?

The drawback, it turns out, is the word "opportunity." Organizations are overwhelmed by opportunity. Companies are too busy putting out fires to spend the time and money on yet-another opportunity. Especially an opportunity that is so sophisticated that it requires technical, statistical and business people all working together to make the most of it.

While Web analytics does indeed represent a significant opportunity -- and we are only just now learning to plumb its depths -- it can and should be used immediately as a fire extinguisher.

Your Web site is burning money.

Do you know the monthly cost of hosting, maintaining, building, monitoring, managing, etc. your site? How much was spent in total in 2007 on all your online efforts? That includes search marketing, banners advertising, email as well as print and direct mail pieces that drove people to your Web site (i.e., all of them).

If you are not measuring the success of your online marketing, you are burning that money. A Web analytics tool can help you get that fire under control and eventually shift from burning every dollar spent into investing every one.

So make your goal for 2008 the effective us of Web metrics. Set your sights on following the return on the investment of every ad campaign and new content development. At a minimum, actively capture and monitor the following:

            Traffic

            Actions

            Outcomes

            Satisfaction

Start with a baseline of your daily Web site traffic. Then subtract out the predictable growth in order to gauge the impact of special promotional expenditures.

Actions or events are the replacement for pageviews. Chances are excellent that your Web site makes use of enough technology that simple pageviews no longer represent visitor activity. Actions will give you a clue about whether and how much content your visitors are consuming. Paying for visits is fine, unless they result in a visit with no actions.

After the visitors show up and click around your site, what was the business result? Did they view a certain number of articles? Did they register for a seminar? Did they download a whitepaper? Did they join a discussion? Buy something? This  requires that you actually have business goals for your Web site. Not everybody does. Strictly monitoring your business outcomes reveals the most important piece of the ROI puzzle.

Does a visitor to your site feel better about your organization after their online experience? How would you know? Well, here we need to step out of strict Web analytics and move over to customer surveys. It's critical that you open your ears to the voice of your online customer to determine the nature of the additional visits and clicks you generated. Were visitors pleased with your new site additions, or did they spend more time and click more often because they were frustrated? If you don't ask, you can't tell.

Until then, that slight smell of smoke around the server room has little to do with a broken air conditioner, and everything to do with your online investment blazing away behind the door.

It's time to grab the fire extinguisher.