Long Road Ahead
Some industry leaders, such as Amazon and eBay, are undoubtedly doing such data sharing and analytics, Forrester's Mulpuru says, but they are also among the most closemouthed because it is essentially their secret sauce. The job of analytics evaluation, particularly among online retailers, tends to fall to marketers, and they have enough other metrics coming at them that, beyond digging into high-level metrics like conversion and shopping cart abandonment, they simply don't have the time or the resources to look at it.
Lack of resources is seen by Sterne as "a big red flag" on the road to more advanced use of Web analytics. Although the technology is there, getting upper management to comprehend what it can do is a challenge. And once upper management understands, you still have to convince them you need the bodies to implement Web analytics, designers to build a Web site in this experimental mode, and skilled analysts to test, measure, retest, and measure again. "You need mathematical persons able to do analysis, as well as people who understand the results well enough to implement appropriate changes," Sterne says. Business users can easily find obvious problems, but good analysts see behavior patterns that point to less obvious, but still important, issues, points out Forrester's Burns in "The Business Case for Web Analysts," an August 2006 report that confronts the topic head-on. She gives the example of an analyst whose expertise at combining data from log files and page tags led him to find serious errors on a company's Web site; not only did these errors make it harder for visitors to use the site, they posed a serious security problem because they exposed sensitive client data to the public.
The argument is that by helping marketers better understand and target diverse online consumers with widely varying needs, an analyst who produces just a 5 percent improvement in the number of effective campaigns and a 10 percent lift in net revenue per campaign can improve the bottom line by more than 30 times his salary. B2B technology firms get the most lift from better site design; they get more value from deflecting call center costs through improved Web self-service than they do from better online marketing.
Short term, Web analytics tools can quickly point out problems that are easily fixed, so they offer a fast payback. But long term, the key to success with Web analytics lies in education--in making upper management aware of the value of the investment. The hard part of the equation is figuring out what it all means and what else it can help you achieve over time. "Poking the data with a stick won't do much for you," WAA's Sterne says. But if you have someone who can figure out the right questions, you can get the right answers.
Jeff Morris is a freelance writer and editor based in South Salem, N.Y. He covers topics as diverse as retail, supply chain and medical technology. he can be reached at [email protected].