Paying attention to web metrics is an increasingly important aspect of search marketing, with methodologies, processes and tools that can dramatically lift marketing and business performance.
A special report from the Search Engine Strategies conference, February 27 – March 2, 2006, New York, NY.
Web metrics seems to increase in complexity every day. Gathering and organizing data from online advertising, search marketing initiatives, affiliates, ecommerce transactions, Web (site) analytics and even offline marketing campaigns is not a simple process.
Key Performance Indicators (KPIs)
“A key performance indicator is a response to the overwhelming volume of data Web analytics applications produce,” said Eric Peterson, Vice President of Strategic Services in the Visual Sciences division of WebSideStory. “KPIs are designed to translate voluminous web data into easily digested metrics that are meaningful to the entire business, presented in the context of change over time with emphasis on indicators that fall outside of expected ranges.”
According to Peterson, KPIs should not be owned by the IT department but rather the business folks. “Things such as conversion rates, etc.—you need to understand your business in order to understand the data,” he said. “Use worksheets to list KPIs, how they are performing in one time frame vs. another. [You” need to put these into context versus where you were yesterday, last week, or last year.”
Effective KPIs should include the following:
- Definition—summarize relationships among meaningfully compared data. Also, clearly define which KPIs are provided to the end user, adding a glossary or annotation, if necessary
- Expectation—establish targets for improvement. Set expectations by providing context of change over time
- Presentation—highlight changes (literally) for easy identification. Each KPI should show a percent change and drive
- Action—Direct additional study and ID areas of the Web site that need work
“The core of good KPIs,” said Peterson, ” is that they always drive action.”
Measuring and organizing KPIs
According to Neil Mason of Applied Insights, two ways to deal with the plentitude of metrics is to have a strategy (what to measure) and a plan (how to measure).
“When thinking about conversion rates and KPIs, think about the customer,” he said. “Different people come to your Web site for different reasons. Site owners should match categories and products with audience segments and goals.”
Mason’s firm organizes the different types of Web site visits into “customer journey” framework which includes audience segments (demographics), user intent, and category/product organization. “Companies need to develop a strategic understanding of site usage,” he said.
Some of the key questions to ask when developing the “customer journey” framework include:
- Who visits the site?
- Why do they visit the site?
- How are they using the site?
- What do they do?
Site visitor activity is carefully monitored on a number of levels. A visitor profile might consist of categories and products viewed, search usage, depth of visit (i.e. page views per visitor), order/transaction activity, and user intent. Combined with entry and exit survey data, user-behavior patterns emerge.
“Different visitors may be visiting the same section of a site in different modes,” Mason added. “I may be searching for a specific piece of content having come from a search engine or I may have got there by browsing. The point is to understand what mode is likely to be predominant in that bit of content and designing accordingly. When is one mode of data integration (hard or soft) more appropriate to use?”
After important data is gathered and organized, Web site owners should adjust their Web site content and marketing campaigns accordingly. “Also focus on customer life cycle management,” said Mason.
Jason Burby, Director of Web Analytics/Business Intelligence at ZAAZ, looks at three types of core data about user behavior:
- Attitudinal data (what do my customers think)
- Behavioral data (what are my customers doing)
- Competitive data (how do we compare with others in our industry)
“Create scorecards to measure organization, Web site, site section, Web team/agency, and individual performance related to business goals,” said Burby. “Share this scorecard throughout the organization. People should be held accountable—bonuses and sales can be based on KPIs.”
“Scorecards are customized to the individual company, site, and audience,” he continued. “It is typical to have a number of different scorecards, depending upon audience and focus. Often, an executive scorecard that simply reports on the performance of the top five to eight KPIs. Different stakeholders can get scorecards based on their specific focus—all rolling up to a specific, overall site KPI.”
“KPIs should be presented in the following quantity: only 3-4 for senior executives, 6-8 for next level down, 10-15 for analysts, etc.,” added Peterson. “For example, a senior strategist might be presented with only two main KPIs—average email response time, and percentage of low and high satisfaction customers.”
“Think about KPIs hierarchically,” he concluded, “and use simple enough data to drive action.”
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