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What is Web Analytics?

"Half the money I spend on advertising is wasted; the trouble is I don’t know which half." This popular saying is as true today as when it was coined by marketing pioneer John Wanamaker a century ago. That is, it’s almost as true, because today online marketers have a powerful solution to this problem in Web analytics.

Analytics is defined by the Web Analytics Association as “the objective tracking, collection, measurement, reporting and analysis of quantitative Internet data to optimize websites and marketing initiatives.” In short, it’s how you determine the effectiveness of your marketing efforts, gather the data you need to fine-tune your site and ultimately maximize your return on investment (ROI). Every single discipline of Internet marketing relies heavily on analytics.

Why Analytics Matters to You

Web analytics allows you to access valuable information undreamed of by pre-Internet marketers:

  • Target Your Audience. See who your typical customers are and how they get to your site. Age, gender and other factors influence how people interact with your website. 
  • Check Your Conversion Path. Measure the loss between any two steps on the way to conversion. You will need this data in order to perform Conversion Rate Optimization (CRO). 
  • Maximize Your Return on Investment. Evaluate the effectiveness of your various marketing methods. Are your pay-per-click keywords paying off? Have you optimized your site for the right search terms? What kind of boost are you getting from your social media marketing strategy? 

Web Analytics Tools

There are two basic methods for collecting analytics data:

  • Log files: Your server already produces this data, which capture every detail of a user’s interaction with your site. Various free and paid analytics services can interpret the data for you, or you can outsource it to an analytics company. 
  • Page tagging: Also known as “Web bugs,” this method gathers data via the user’s browser rather than your server. Page tagging requires signing up for an analytics service and adding JavaScript tags to each page on your site, and tends to be more accurate than log files. 
Log files and page tagging each have distinct advantages and disadvantages for analytics strategies.

An Ongoing Process

The Internet changes quickly, so a successful Web analytics strategy must include a continuous improvement program (CIP) in order to stay ahead of your competition.

  • Key Performance Indicators (KPI): Create a set of measurable factors you use to gauge your success so you can consistently chart your site’s long-term performance.
  • Testing: Test changes to your site and use this data to make continuous improvements. 
  • Consistency: Controlled testing will allow you to more accurately predict what effect changes will have on the site. 

In this section, you’ll find analytics tutorials and tools from analytics experts, as well as information on training and services offered by analytics professionals. Check our blog for regular updates on new developments in Web analytics.