The Web Analytics Association defines Web Analytics as "the objective tracking, collection, measurement, reporting and analysis of quantitative internet data to optimize websites and marketing initiatives".

Web Analytics empowers companies to understand better how visitors to their websites reach with those sites; it also enables them to comprehend other important factors, including site traffic trends, marketing campaigns, and conversion dynamics.

Web Analytics allows companies to determine the factors preventing site visitors from following through on their conversion objectives. It enables companies to identify different types of site visitors, so that they can discover who their best customers are and which markets are most lucrative. Web Analytics allows companies to find out how the site operates, and to specifically target optimum search marketing campaigns and/or strategies (i.e. Pay-For-Calls and Pay-Per-Click Advertising, SEO). Ongoing improvement in site performance should be a central objective of Analytics; this valuable information should be shared with pertinent company personnel (i.e. Sales and Marketing) so that Website and Marketing Campaigns can be fine-tuned.

Understanding Web Analytics results is significantly enhanced when a company sets up an Ongoing Improvement Program based on Key Performance Indicators (KPIs). KPIs should be rooted in a company’s overriding business goals and the website’s role in meeting those goals. KPIs should be company-specific, easily measurable, in line with long-term objectives, and agreed upon by all relevant personnel, specifically management. Understanding Web Analytics results is also enhanced when a company applies the Customer Life Cycle Framework (Reach, Acquisition, Conversion and Retention).

All SEO Programs feature Web Analytics services; there are nine (9) distinct phases:

Phase 1 – Deduce Needs

Determining and then meeting the requirements of site visitors is essential; there are usually several steps involved in site activities which enable visitors to meet their needs and it is important that they are user-friendly. Analytics allows companies to identify and curb lost sales at different steps, which results in better overall conversion rates.

Phase 2 – Identify Goals

Identifying and quantifying the company goals you want to meet through online business will depend on the type of commercial website. There are four main site categories: E-commerce (increase sales & decrease marketing spending); Content (increase readership, including level of interest and length of time spent at site); Lead-Generation (increase and classify lead generation) and Self-Service (increase customer satisfaction & decrease customer support enquiries).

Phase 3 – Define Metrics

A wide range of site data can be measured and analyzed, but it is important to measure information which improves your site and business performance (i.e. costs and revenues). Identifying the processes which result in higher conversion rates and then establishing concise, quantifiable goals for improvement are important considerations (i.e. are you attracting new site visitors and are they spending more time at your site?; how well are you converting them and how user-friendly is your site in helping them to achieve their intended actions and/or objectives?)  Key terms are Metrics for Measuring Reach, Measuring Retention, Measuring Conversion and Using a Conversion Funnel.

Phase 4 – Gather Data

One type of web analytics tool used for collecting data features page tagging with JavaScript, which involves including JavaScript code on each page that refers to a JavaScript file on your site. Advantages of page tags include: high accuracy, speedy data reporting, easy data collection, and lower upfront costs. Disadvantages include: reliance on JavaScript and Cookies, reliance on Cookies as a Unique Identifier, and adding page tags to every page, which often ends up being very time-consuming. Other problems include: the laborious process of tagging, lag-times in page performance, time restrictions on data storage, limits on the type of data collected, and privacy concerns.

The most basic website accounting unit, web server log files capture the micro details of every user interaction (i.e. Data, Time, Client IP Address, Referrer, User Agent, Service Name, Server Name, Server IP). These files enable companies to identify the most- and least-visited site pages, other sites referring visitors, the browsers and operating systems used to access the site and when the site is visited by search robots and directory editors. Advantages include data ownership, easy data collection, flexible employment (i.e. no price tagging or other page coding), database integration and measurable robot traffic. Disadvantages include proxy caching (information might not reflect content’s original site), and browser caching (information is stored on user hard drive and not recorded in log file). Other drawbacks include the inability of IP Addresses to identify visitor uniqueness, since many users are identified by the same address, as well as upfront costs (i.e. hardware, software and expertise).

Phase 5 – Record Baseline Information

Quantifying goals and recording the baseline data allows a company to measure expected changes and to achieve better conversion rates. Segmenting the perceived obstacles into smaller, manageable actions and testing them one at a time allows the company to solve problems more efficiently. It is essential that this information be shared with all appropriate personnel.

Phase 6 - Test Improvement Methods

Measuring the multi-step sales process is essential, but other conversion factors should be considered, including: downloads, lead generation forms, search functions and information-generating navigation. Collecting pertinent data from site visitors also helps improve site performance. Data should be compared only against previous site data, as comparisons against competitors or industry information is irrelevant.

Site business activities which increase success should be measured.  These activities include: sales process, registration process, extensive demos of products and/or services, and onsite search.

Phase 7 – Employ Improvements

Conversions are essential to business success. Before final employment of site changes, companies should run a program of A/B split testing to measure the effectiveness of a proposed site or campaign change. Different versions can be tested against the benchmark, offering valuable information about which changes have more positive impact and by how much. Advantages include being able to retain your current conversion rate for part of your site traffic, since A/B testing allows proposed changes to be sent to only a portion of the current pages.

Phase 8 – Measure Results

Measuring conversions and Return On Investment (ROI) are important aspects of gauging Search Engine Marketing Campaigns. Online marketing and the growth in web analytics tools means that there is an ever-increasing demand for marketing accountability. Having analytics tools in place for easy measurement of marketing performance is essential in today’s competitive marketplace.

Phase 9 – Repeat Steps & Improve Process

Companies which continually track site conversions and then fine-tune their goals and metrics to improve these conversions are ahead of the game. Analyzing your information and then intelligently employing different internet marketing strategies empowers you to better identify areas where improvement is required so that you can maximize your ROI. Companies which undergo ongoing and insightful revisions to needs, goals, data collection, measurements, and employed marketing strategies will always fare better!