With the easy availability of full-featured, free online services like Google Analytics, an increasing number of companies are implementing Web Analytics tools for their web sites. Many of these implementations still focus on older metrics like page views and click-throughs. Although conversions and overall traffic levels continue to be important, today’s Web Analytics tools - which have come a long way from the “Log Analyzers” of ten years ago - can provide a rich set of Business Intelligence metrics that allow web site managers to drill down to much greater depth in understanding user behavior.

In this article, we identify the core Business Objectives for a Web Analytics implementation.

Web Analytics Objectives

1. Traffic Measurement and Analysis
One of the primary goals of web analytics is to measure traffic quality, volume and engagement (e.g. time spent on site ).
Traffic can be segmented by source, into three categories:

• Referrals from other web sites and from marketing campaigns
• Free (organic) traffic from Search Engines, which depends on the quality of content and on SEO tactics
• Paid (AdWords) traffic from Search Engines

2. Measure and Optimize the Effectiveness of Conversion Paths
This is the usual definition of web analytics; it includes an audit of key navigation paths, calls-to-action, pricing, discounts and the power of the overall sales pitch. You can also measure the effectiveness of individual web pages.

3. Test and Optimize Conversion Enhancement programs
Closely related to the previous item, this goal is all about enhancing revenues from a current buyer, by optimizing upsell and cross-sell strategies. It answers the questions: “How well do you encourage users to buy more? How often do you get repeat buyers?”

4. Measure “Bounce Rates”
This is one of the simplest and most important metrics, yet it is often neglected. This metric focuses on discovering which pages on the site cause users to drop off. This is a critical point of analysis - it can highlight deficiencies in the web site, navigation or content.

5. Gauge the Effectiveness of External Marketing Campaigns
Web site traffic analysis can provide valuable feedback about external Marketing campaigns: by source, medium (email, web page, print, blog feed) and campaign. It can be used to test various forms of advertising.

6. User Segmentation
A site audience is rarely completely homogeneous; it is usually made up of several distinct constituencies. A highly effective way to enhance the user experience is to segment users into groups by behavior and re-orient the site for each group, with special navigation and emphasis.

7. Day-parting
This is segmentation based on external factors not related to the user herself; e.g. time of day, geography, referring source, organic vs paid, and so on.

8. Drive Design and Usability Decisions
Many companies make site design decisions “blindly”, without measurement or testing. However, instead of trying to guess what users will like, we can directly measure the effectiveness of various web design and usability decisions, individually and together, using multi-variate analysis and A/B testing. This means that we can improve a web site in a systematic, measurable way, while minimizing any adverse impacts.

Conclusion

As we’ve seen above, Web Analytics provides powerful capabilities to systematically improve online sales and analyze user behavior. Which of the objectives in this list do you use? Do you see any that are missing from this list?