• by Shankar Gupta , November 14, 2005

In an attempt to attract more AdWords advertisers, Google Sunday night started offering free analytics services through Urchin, a company the search giant acquired in late March.

The tool, "Google Analytics," can be used to track all online marketing efforts--including paid and organic search, display ads, and print ads with urls--said Paul Muret, an engineering director with Google and co-founder of Urchin. "Any time you're driving traffic to your Web site, Google Analytics will track it," he said. "We're always trying to provide the tools to let our advertisers improve their advertising, improve their Web sites, and at the end of the day, improve their ROI."

The product can track campaigns run on Google's paid search competitors, including Yahoo! and the upcoming MSN adCenter, Muret said.

For AdWords users, the service is free, no matter how much traffic they generate. Users who do not have AdWords campaigns can also use the service for free, but with a cap on traffic--5 million page views per month.

Muret said that Google's decision is aimed at helping advertisers better manage their online advertising, including their AdWords campaigns. "Making money is important, but Google wants to give advertisers visibility into how the AdWords system works, and give them the intelligence they need to make smart decisions," he said. "Google wants a sustainable system that works for the advertisers--we want to give those advertisers the confidence to make those decisions."

This move could throw a wrench into the business models of some analytics firms who, until now, have relied on their customers paying for their products, said Eric Peterson, a senior analyst with Jupiter Research. "It is going to create tremendous pressure on those analytics tools that have traditionally sold into the SME market," he said, referring to small and medium-sized enterprises.

"Now that a slightly better version of Urchin is going to be available for free, that's going to give those respective CEOs a little bit of headache and a little bit of heartache," Peterson said.

He added that the version of Urchin that Google is offering--which has a streamlined interface and features report dashboards--will satisfy the needs of the vast majority of firms that require analytics software. "If you look at all of the features and functions of an analytics toolkit, you can say that 80 percent of the companies using this are only going to use 20 percent of them, and that 20 percent is here in Google Analytics," he said.

"It's not a bad play, really. How do you engender loyalty? You give them tools at low or no charge, and help them use them."