Why Web Analytics Are A Necessity

Business.com / Business Intelligence / Last Modified: February 22, 2017

Web analytics is emerging as a necessary tool for many businesses to employ, and this article discusses why businesses need its benefits.

With the seismic shifts in technology and the free flow of big data in the new millennium, small- to medium-sized businesses (SMBs) are increasingly taking measures to study their website analytics to enhance their customers' online experience, improve overall business operations and stay competitive.

Do businesses need web analytics?

Microsoft's Monte Enbysk doesn't mince words when he explains why SMBs need Web analytics:

"As a small-business owner, you're not likely to hire a new employee and then become totally clueless as to whether that person ever shows up for work.

You're also not likely to take on a new partner without some way of tracking the revenues, benefits or efficiencies gained from the relationship. So why do so many small businesses build Web sites, invest in online marketing campaigns and then devote little or no effort to analyzing the return on their investment?"

With so much data coming in every day, it may be overwhelming to manage it in a way that makes sense, especially if you've had no prior experience analyzing Web metrics. However, website analytics can help you understand your audience and drive your business initiative, and improve customer service, sales, marketing, and other aspects of your business. Phillip Klien, CEO and co-founder of SiteApps, writes in Small Business Trends, "Whether you're questioning the success of your blog content, wondering if specific content fits better on another page or looking to see which devices viewers use to access your site the most, website analytics are there for you."

How widespread is web analytics usage among businesses?

Apparently, it could be better. A study of SMB online strategies commissioned by SiteApps and conducted by the Incyte Group in January 2013 showed more than half (54%) were concerned about not keeping up with the technology and lagging behind their competition.

The Wall Street Journal reported in April on some key findings in the SiteApps survey, and questioned the wisdom of uninformed spending:

"[T]he survey indicated an overwhelming response from small businesses who say fixing, improving or even totally overhauling their websites will be a major priority in 2013. Given a blank check, 34 percent would choose a new website over all other marketing investments, more than double the response to the second-ranking (15 percent) paid search campaigns. Findings indicate that they may not be setting their websites up for success -- that is, neither offering the information, resources and experience that customers and prospects desire, nor learning about ways to engage and retain visitors."

Other findings included:

  • 75% did not use an analytics tool (such as Google Analytics) to measure website performance.
  • 60% do not feel they have the tools to make sense of their site analytics or take action to resolve issues.
  • 60% do not have a mobile website or know if their website is mobile-compatible.
  • As a top customer-acquisition tool, email stands at 37%, websites 32%, print media 16%, social media 7%, review sites (Yelp) 4%, and search marketing tools (AdWords) 4%.
  • 41% plan to focus the majority of online marketing efforts on new design and content for their website, followed by personalizing customer online experience 29%, external website marketing efforts (social media) 18%; and pay-per-click campaigns 12%.
  • 41% say Facebook is the most effective social media channel to reach customers; 47% chose "none," LinkedIn 10%, Twitter 2%.
  • 51% said social media wasn't a component of their online marketing efforts in 2012.
  • 49% don't feel they need to improve their websites; 46% say the website is not a priority.
  • 59% anticipate spending less than $1,000 on their websites.
  • 35% will spend between $1,000 and $10,000.

What businesses can learn from web analytics

Web analytics is more than a tool to tell you how many visitors your website has received this month. Modern Web analytics tools not only can help you monitor and analyze your traffic by tracking the numbers, but also help you assess visitor behavior and thus evaluate the effectiveness of your online marketing efforts.

Web analytics tools can show:

  • Search engine rankings and results (which search engines are sending you traffic and which aren't; how you can improve keywords buys and search engine submissions)
  • Where the traffic is coming from
  • Your site's most and least popular pages
  • Which operating systems and browsers visitors are using

You can also track conversions (sales), see which steps led to those sales, which pages work best and which are exited often (and therefore may need better content). You can see what your customers are interested in and what tools they use, which aspects of your online marketing plan aren't working and which are.

You may be surprised to discover that one of your links is broken or that the newsletter signup you weren't sure about is bringing in new customers, but that the free product trial you're offering is not performing as well. For some good tips on how to measure your online marketing efforts, see a post by Francoise Brougher, vice president of SMB Sales and Operations at Google, on the Google and Your Business Blog.

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