In-Depth

Special Report: Web Analytics

To know that 10,000 or 100,000 or 1 million visitors an hour or week or month are visiting your Web site won’t fatten the bottom line. However, knowing where they come from, what they do on the site, how long they stay, when they leave, and more can mean a great deal. And that’s the promise of this latest generation of Web analytics tools.

There is no end to the questions savvy Web managers must answer if they hope to squeeze the maximum payback from their Web sites. At what point in the checkout process are shopping carts being abandoned? Which customer segments are abandoning them? Why? Which items should be grouped together on a page? Where on the page should these items be put to get the best response? The answers to these and many other questions must come quickly—in real time if possible, when it’s still possible to do something about it.

Managers can’t even rely on carefully considered decisions of the company’s best marketers and merchandisers. “We tried to do the classic Amazon.com thing showing what other customers also bought,” recalls David Seifert, director of operations, direct marketing, at Bass Pro Shops. “We tried it with a home-grown system. Then we tried asking what our buyers and merchandisers thought. Then we tried Coremetrics, and we saw an immediate increase in conversions.” Not even the company’s buyers and merchandisers could argue with the numbers.

Going beyond clicks
Coremetrics, WebSideStory, WebTrends, Omniture, Sane Solutions and others represent the latest in Web analytics—tools that capture, monitor and analyze a Web site’s traffic. These tools start with the basic clickstream and then add advanced analytic capabilities.

From the reports they produce, managers can redesign the Web site, rearrange and regroup items, alter market segmentation and straighten and streamline processes to boost response. The tools can tell a manager which search words or combinations of search words generate the most hits or the highest rate of conversion (the two aren’t necessarily the same) or what to offer in a follow-up promotion. For B2C, B2B and service-oriented Web sites that want to get maximum value from each visitor, these tools are a must. Just knowing how many hits a Web page received is no longer good enough.

“The tools start with the clickstream as the raw input, but they quickly add higher value analysis for campaigns or usability or search bidding,” says Bob Chatham, principal analyst, Forrester Research. Although the vendors argue otherwise, the differences between the various Web analytic products are slight. Observes Chatham in his June 2004 report “Selecting a Site Analytics Product”: “The wide array of Web analytics choices presents a challenge for buyers. Web analytics products are often nearly impossible to tell apart on first—or even second—look.”

Although most often associated with the large retail and B2B commerce sites, Web analytics tools also can be applied to service-oriented sites, such as those operated by FedEx and Verizon. For these sites, the tools must be capable of being used to analyze rich scenarios that go beyond the initial purchases. Customers returning to the site for added services or support present more opportunities to further mishandle or cultivate the relationship and the value it represents. For these sites, the tools need to exchange data with other systems in the supply chain.

Real time is a good time
Carfax helps prospective buyers shop for used cars online by searching its nationwide database of used cars. The company started using Web analytics that processed data from log files. Early in 2000, the height of the dotcom craze, “We couldn’t process log files fast enough…it would take days,” says David Silversmith, CTO.

By spring that year, Carfax had jumped to WebSideStory, a Web analytics ASP that provided data in real time. “At a board meeting, we looked at the number of visitors we were getting,” Silversmith recalls. “A little while later, we hit refresh and saw how many had come onto the site in the interval.” Suddenly, the company could see changes hour by hour. Previously, managers had to wait a week or more. “We do a lot of A-B testing, and having to wait a week made it hard to test a campaign,” he adds.

The A-B testing feature, which lets Carfax compare the results of changes side by side, is the WebSideStory feature the company likes best and uses most. Now Carfax is starting to search engine analysis. “A visitor clicks on us from a search engine, and we can see which bid words are bringing us this visitor,” Silversmith says. Given that search engines charge for keywords and put the most popular words out to bid, the information it gets from its Web analytics is crucial in formulating its strategy. Up next from WebSideStory is a bidding analysis tool, which Silversmith is eagerly awaiting.

Novell turned to Omniture’s SiteCatalyst after spending more than five years trying to analyze log files on its own. “We would crank logs through our tool, and it would take one full-time person and another person part time to make reports,” says Kim Eaves, Novell’s director of electronic marketing. With SiteCatalyst, the entire process, from analysis through report distribution, is automated.

Like Carfax, Novell relies heavily on the product’s real-time capabilities. “If we put something on a page and it is not getting hits, we want to change it,” Eaves explains. “In the past, it took us a week to know something wasn’t working, and then it was too late to do anything. Now we see it immediately.”

Most of the vendors now provide real-time analysis and reporting. Novell opted for Omniture because of its user interface and customer support. “This is their core product,” Eaves says. “They don’t do other things. At user conferences, they are focused only on user issues. They are always asking us what we need, and they are fast to respond.”

Eaves finds the SiteCatalyst user interface clean and simple. She particularly likes the feature called Click Map. “You just run your mouse over sections of your site and you can click and get data,” she says. Her only complaint: Omniture doesn’t yet collect metrics for Linux browsers, something increasingly important to Novell, which recently acquired SUSE Linux.

Metrics mavens do the job
The San Diego Union-Tribune also turned to WebSideStory four years ago after wrestling with log files. Again, it was the real-time analytics that clinched the deal. “Real-time is important to us,” says Chris Jennewein, director of Internet operations. “We’re a media operation, and we want to know in real time what visitors are looking at.”

Jennewein’s team is prepared to update the site frequently throughout the day based on the information it’s getting. “We’ll update the site as often as every 10 minutes based on traffic,” he explains.” If a story is generating a lot of traffic, we might move it higher up on the page or give it a bigger headline or change the art.”

The company puts the WebSideStory dashboard on the desks of several people throughout the organization, not just the Internet operations team. For instance, the marketing people have access to it and will use it as they review marketing plans and formulate new promotions. The advertising department looks for where the traffic is coming from, a key interest of advertisers. “The advertising people will look at section traffic and maybe sell a single page,” Jennewein says.

The newspaper also likes the ASP model. “I don’t want to run software on our own systems,” Jennewein says. “We don’t want to operate a data center... The days when we had to touch the hardware and software are past.”

CompUSA runs Coremetrics every day to identify where traffic is coming from, to watch the various paths visitors take through the Web site and to segment its visitors. “We’ve aligned our team with Coremetrics and put metrics from it into a KPI [key performance indicators] chart,” says Al Hurlebaus, director of e-commerce for CompUSA.

A particularly powerful feature is Coremetrics’ Lifetime Individual Visitor Experience Profiles. LIVE profiles capture every click a visitor makes and stores it in a data warehouse maintained for each Coremetrics customer. A company can build a report for every visitor, sort the reports in a variety of ways and target e-mail and cross-selling promotions at the customer. “LIVE Profiles give us great information,” Hurlebaus says.

The company capitalized on the power of Coremetrics last Christmas when Apple’s iPOD became a huge hit. It let the company identify three or four paths most people took after they entered iPOD as a search term. The company was able to assemble three pages for those interested in iPODs and then send them e-mail with links to those pages for the holiday season and sold more iPODs in the process. Now the company is tapping its LIVE profiles for use with Coremetrics’ LIVE Mail in conjunction with CompUSA’s e-mail service provider to increase the effectiveness of its e-mail campaigns.

Coremetrics turned out to be pricier than the other leading tools, Hurlebaus says. “It is the Cadillac of the industry, and it is priced accordingly,” he says. Despite the higher price, he continues, “we’ve had more than a good ROI. And we keep getting an ongoing return.”

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