It was heralded as the great equalizer, the technological wonder that would put business start-ups and large corporations on the same level playing field. Although things haven't worked out quite that way, it's hard to argue with the notion that the World Wide Web is one of the most potent marketing tools in a growing company's arsenal.
Despite, or perhaps because of this perceived power, it can also be a source of puzzlement and frustration. Business owners accustomed to control and accountability often are pained to discover that their websites offer more questions than answers. How many new customers did we pull in last month? Is it serving the needs of the company's constituencies? What kind of return is the business getting on its Internet investment?
Many companies are unaware that the answers to these and other questions are within arm's reach. Every Web server collects a wealth of data about site visitors, from their Internet Protocol addresses to the types of browsers they use. The server's activity log can tell you what Web link a visitor clicked on to get there. It can provide the word or phrase that prompted a search engine to cough up the company's name. It can tell you exactly what a user did on the site -- which pages they viewed and the order they viewed them, how long they stayed on the site, and where they went when they left.
In raw form, this data is incomprehensible. But easy to use and relatively inexpensive "Web analytics" software can bring it to life, transforming what looks like gibberish into the equivalent of gold. By slicing and dicing the data, these programs make it easy to evaluate the performance of different Web promotions -- banner ads, search engine campaigns and e-mail letters -- and help you put your money where it does the most good.
Analyzing how customers and prospects use your website helps you decide what elements of it are resonating with users -- and which parts need work. Such feedback is essential to maximizing your Web ROI, says Bryan Eisenberg, principal of Future Now, Inc., a Brooklyn, New York, consulting firm. "If you make changes without using the analytics," he say, "it's like driving in the dark."
How can a growing company with modest resources harness the potential of Web analytics? It's actually pretty easy. At least a dozen vendors including ClickTracks, Mach 5, Microsoft bCentral, NetIQ, NetTracker, Quest Software, Urchin and WebSideStory offer virtually plug-and-play solutions. These programs are ideal for small and midsize companies whose sites are mainly intended to promote products, generate sales leads, or provide customer service. Prices range from $100 to $900 for programs installed on your company's computers. Hosted applications cost $20 to $150 per month. Mach 5, Microsoft bCentral, and Quest Software even offer free Web analytics software or services for companies with very limited needs or minimal budgets.
Most of these companies also sell more powerful and generally much costlier solutions that are better suited to growing companies with e-commerce "shopping basket" websites. For example, NetIQ's WebTrends Intelligence Suite, costing $30,000 and up, incorporates data warehousing, multi-dimensional modeling and content management features.
Other advanced solutions stress the ability to work hand in hand with other types of applications, such as customer relationship management, database and accounting systems. Heavy-duty e-commerce applications such as Microsoft Commerce Server 2002 integrate Web analytics tools with catalog management and customer profiling tools to identify cross-selling opportunities and target customers with special offers based on their shopping behavior.
Bob Chatham an analyst at Forrester Research and an acknowledged expert in Web analytics recently issued a report called "The Web Analytics To-Do List for 2004." In it, he reminds companies that data alone won't drive customers to a website, boost sales, or increase the bottom line.
However, a better understanding of how users interact with a website can lead to a more positive experience that will turn them into paying customers and ultimately maximize the return on a company's investment.