Whatever Happened To The Web Analytics Industry?

Late the other night I finished Google's new digital marketing analytics training program, Analytics Academy. It's intended to help beginners acclimate to marketing/web analytics broadly, and the Google Analytics platform specifically. I was relieved to find that most of the material was a refresher for me; the kid's still got it. For many, though, the course has likely been a great on-ramp to the fascinating world of digital marketing analytics.

Despite its "refresher" status, completing the course provided me with the same sense of accomplishment as reading a long book can. After the final examination, as I basked in my moment of glory, I began to think about how it must feel for the newly indoctrinated. This world of big-data marketing analytics is large and ever-expanding, complex but exhilarating at the same time.

And despite the limitless potential for innovation through data, what does this exhilarating world look like through the eyes of a newbie? I have to imagine for most it looks like one dominated by Google, or at least one where innovation is occurring on top of a Google Analytics foundation.



But where's everyone else? What happened to the rest of the Web analytics industry?

When I first began my career in search and digital marketing nearly a decade ago, the focus of "big-data analytics" (which wasn't a buzzphrase then) was Web analytics. And what a cluttered mess the landscape was then. Web log file-based solutions were preferred, and vendors like ClickTracks (greatest web analytics tool ever -- RIP, my friend), Urchin, and Webtrends were leading the way. Those early platforms had a tough road before them: Log file analyzers had previously been deployed on-premise to assess web server "hits," and were typically the domain of the IT department. Promoting a marketing-first mindset couldn't have been easy.

As adoption grew, the technologies evolved. JavaScript page-level tagging became the preferred tracking method, and vendors like Omniture and WebSideStory (the former would later acquire the latter) emerged as market leaders. Then came Google's acquisition of Urchin, and with it the Web analytics space was forever changed.

I can still recall the excitement I felt when I realized Google had made the announcement that it was giving away access to its analytics tool (renamed by then "Google Analytics") free of charge. I immediately signed up several client websites, though not all of them were happy with the news. One of my clients at that time actually sold a hosted Web analytics application. Following Google's move to a free model, I received an email requesting that we pull back on our AdWords spend noting, "Google is going to eat everyone's lunch."

Fortunately that scenario didn't entirely materialize. True, the old guard of Web analytics have either been shuttered or acquired and incorporated into broader, more diversified platforms. But innovation has continued to push the industry along. That's an outcome I hoped we would see, when I lamented the loss of the Urchin log file analytics technology in a previous column. Analytics vendors seemed to have taken the approach that if you can't beat Google, diversify and innovate around it.

Which leads to the world of analytics that the newly anointed are stepping into today. It's one defined by new terminology: first- and third-party data, demand-side platforms (DSPs), and data-management platforms (DMPs). It's an environment that's obsessed with optimizing the entire customer experience, by applying technologies and techniques that my friend Rand Schulman calls "convergence analytics." It's about understanding customers down to the individual and even emotional level (social sentiment), engaging and nurturing them toward a purchase decision (marketing automation), all at scale. It's the driving force behind the rise of the real-time bidding (RTB) display ad exchanges; even the rebranding of the Web Analytics Association to the Digital Analytics Association.

These are indeed exciting times for anyone tasked with data-driven marketing. To those of you who are just joining us, welcome to the party.

6 comments about "Whatever Happened To The Web Analytics Industry?".
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  1. Frank Watson from Kangamurra Media, October 30, 2013 at 1:53 p.m.

    Basically Google bought Urchin and started giving it away - people went for free and all the small analytics firms folded

  2. Kevin Pike from Rank Fuse Digital Marketing, October 30, 2013 at 2:16 p.m.

    Ryan, you answered your question in the article... Google went "free" and everyone else doesn't work for free, so they died or evolved into something else.

    The only thing holding on is "marketing automation software". Basically anything that gets the sales team and marketing folks individual user data can offer something that Analytics will never provide.

    On a final note, now that Google Analytics is defaulting to sample data and not the entire traffic, new entrepreneurs out there now have a new leg to stand on - but I'm sure if anyone threatened the Analtyics market share again, Google would go back to "not being evil" and provide us with full reports again.

  3. Juliette Cowall from Godwin Plumbing & Hardware, October 30, 2013 at 2:24 p.m.

    The welcoming attitude is something I've always appreciated about online marketing professionals - whether analytics, SEO/SEM, RTB, retargeting, link-"building" (oh, wait. that died), etc. I'm about four years in, so technically not a "newbie," but still have much to learn. I did the Academy. Most was refresher, but I did learn about some tools I hadn't had the opportunity to work with before. Thanks much for your - and the community's - generosity in sharing your information and insight.

  4. Pete Austin from Fresh Relevance, October 31, 2013 at 6:40 a.m.

    Analytics are alive and well, for example extending Google Analytics and providing real-time personalization and targeting.

  5. Blair Reeves from IBM, November 7, 2013 at 11:50 a.m.

    I don't think it's any surprise what has changed:

    1 - Analytics itself quickly became a commodity, which is very difficult to charge for in a sustainable way. Google understood this, so they give it away for free (which was a strategic decision to, er, sell more of their core product, advertising).

    2 - The *application* of digital (and customer) analytics is where the true value exists. So you see a lot of activity centered around getting the right people to turn that data into marketing gold (the oft-mentioned analyst unicorn search) AND the software tools that make that process easier. The guys like Cardinal Path or Demystified do the former, IBM and Adobe do the latter (and some of the former too, I guess).

    3 - The "web analytics industry" has by and large turned into the digital marketing industry. Analytics just provides the basis for the marketing execution capabilities that companies want to pay for, and that's where the fiercest competition exists today. Coremetrics = IBM Digital Marketing, Omniture = Adobe Marketing Cloud, etc. Analytics is still hugely important, and there are still important differentiators between solutions, but it's about so much more than just the analytics now.

  6. Rand Schulman from efectyv digital, November 11, 2013 at 12:31 a.m.

    Yes, I Agree Ryan and thanks for the mention in the post. It is about ACTION and not just reports. We must be very careful of vendor jargon, words like "real-time", "predictive" and "multichannel" need to be really understood before buying solutions. Purpose needs to be defined, and for that we need people. You need to have that on staff, or use an agency.

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