Webinar Recap: Web Analytics for Online Retailers
It was a privilege to have esteemed author, researcher, consultant and speaker Eric T. Peterson join us for this months webinar: Web Analytics for Online Retailers - Technology & Satisfaction 2008
Eric is the founder and CEO of Web Analytics Demystified, where you can find more helpful information and research on the strategic use of web analytics, staffing issues, business process and measurement.
Eric presented the findings of a study of web analytics practitioners and I highly recommend you watch the replay to see the full charts because there is a lot of data you may find interesting that is not covered in the highlights below.
Overview of the Web Analytics Marketplace
- Web analytics is an evolving market - Google bought Urchin a couple years ago and began to offer it free, it's a good entry level product but doesn't do everything. Microsoft acquired a Canadian analytics package and rebranded it as AdCenter Analytics. More recently, Yahoo bought Hungarian IndexTools which is a great product for online retailers. This product will likely be offered free also, but we'll have to wait and see.
- There are many other paid solutions including Omniture, Web Trends, Coremetrics and Unica. The tools themselves won't make you successful, however. You need RAMP: Resources, Analysis, Multivariate Testing to determine what changes you need to make and Process. Process is very important, and if you don't have a process in place be sure to download Eric's white paper on web analytics processes to get a feel for what process involves.
- Eric emphasized that web analytics is hard. It's easy to add the tracking code and create reports, but the analysis and interpretation of analytics to make business decisions and get people in the organization to listen is not. Set the expectation that web analytics is hard, not a walk in the park.
Characteristics of Online Retailers in General
- Online retailers are typically sophisticated, and ahead of other website owners in terms of adoption of web analytics elements. This makes sense because it's easier to calculate ROI when you attach a dollar amount to each conversion goal, whereas B2B lead generation sites cannot do this as easily.
- Retailers are usually well staffed for analytics, have good KPIs (key performance indicators) in place, use multivariate testing and often have "one good story to tell." This means most retailers can tell you how analytics has saved them thousands or millions helping them identify PPC click fraud, improve navigation or email marketing campaigns et cetera.
- Conducted in October 2007, Peterson and company selected purely web analytics practitioners (rejecting vendors and consultants). Of 280 participants from the US, 85 were online retailers and 195 non-retailers.
Notes on Survey Findings / Highlights
Types of tools used:
- Mostly using licensed tools from a web analytics vendor 87% vs. 12% using free tools.
- Most use 1 tool (45%), 36% use 2 tools, 17% using 3 or more
- If you employ 2 different analytics tools you will get different answers. Who do you believe? Why are you employing these tools? (Answered later in presentation)
- How long have you used your current tool? Most using 1-2 years, only 6% have been using their tools over 5 years.
- Used to be that practitioners would switch every year to a new tool hoping that it would perform better, but the problem is was not necessarily the tools themselves, it was how the tools were used or not used (in most cases), which comes back to RAMP - is there multivariate testing and process in the mix? Now only 14% of online retailers reported using their current tool for less than one year.
- Sticking with one tool for over 5 years does not mean the tool is that great, it could indicate that the company has not upgraded the package and is using outdated tools, or doesn't know how to use them properly anyway. The question is how are you using the tool, and why haven't you looked into other tools.
Top 3 tools used by online retailers:
- Omniture 26%
- Coremetrics 19% - far more online retailers vs. other businesses
- Google Analytics 14%
Reasons for selecting the primary vendor:
- Presence of advanced functionality (34%) and price (22%) stood out. Online retailers were far less price sensitive compared to other businesses, indicating that retailers understand that if a tool helps them sell more efficiently and earn ROI, price is less of a concern.
- Eric suggests that 10% of your time/resources be allocated to getting a tool, 20% to the analyst and 70% to process. Even if you have an excellent tool and a skilled person, you may not be taking advantage of the technology to its full potential.
When secondary tools are employed:
- 56% have co-deployed Google Analytics. All other options were used by 2 - 11% of retailers. Most were using a second tool because they wanted additional depth that the primary solution didn't offer. 36% wanted to validate data from the primary tool against the secondary, since there are no practically enforced standards for reporting between tools, although standards do exist. Eric asks why don't you trust your primary solution? If your process is solid, you shouldn't have a strong need to validate.
- Google Analytics is popular because it's free and has excellent integration with Google Adwords data. Other reasons for using multiple tools include different employee preferences or tire-kicking on new solutions when considering a switch.
Other measurement tools:
- Online retailers use Hitwise and Offermatica more often than non-retailers, and are less likely to rely on Nielsen Net Ratings or comScore. Other measurement tools include Foresee, Tealeaf, Compete, Alexa, iPerceptions et cetera. Eric noted it was encouraging to see online retailers leading the way in adopting other measurement tools.
Satisfaction Criteria, Primary Vendor:
Eric presents stats on each of the following ranking criteria
Ranking: Customer Support - important! Analytics is hard. Google Analytics' support is not as good as paid solutions (heck it's free and support is expensive to offer). You should be able to call and email your vendor and get support.
Ranking: Support Materials
Ranking: Corporate Communication
Impact: Search Engine Marketing - 26% agree completely, and 29% agree somewhat that analytics cause them to increase investment in online marketing. You can prove that you are using your online budget wisely when decisions must be made on scaling back on marketing during a recession, for example.
- Retailer sophistication with web analytics is high, often higher than other website owners
- Retailers appear to be giving web analytics a fighting chance - longer than one or two years
- There are some important differences between retail and non-retail analytics
- Retailers are, by and large, satisfied with their investment
- Web analytics is having an impact on search marketing spend
- Think about how you compare
- Especially focus on satisfaction and ranking
- Ask yourself, “Am I better off than average?” - including better than average relationships with your vendor
- Forge an action plan to upgrade your analytics capabilities
- Plan to fill gaps by August 1st
- Make sure to have a strategic road map including reporting methods, how is it going to get done (process!)
Email Eric T. Peterson at eric AT webanalyticsdemystified.com
Questions to be posted with webinar replay...hold tight!