Many companies pick an analytics program and install it without first taking a step back and asking a very important question. In fact, this single question can make the difference between your analytics system making you money or being a time waster.
Look at everyone on your team (SEO, PPC, designer, CEO, etc) and ask them one simple question:
What do you need to know to get your job done?
Make them list out their needs. The designer will want to know things like browser types, browser resolutions, etc. Your marketing people will need to know conversions by traffic sources and keywords. The SEO is looking at referral traffic information. Let everyone list out their needs.
Then look at the list and ask each of them, “What is it worth to our company to pay for this information?”
If you have a team of one, and you use wordpress to run your company, knowing which versions of flash are being used is probably not information that’s worth paying to obtain. If you spend $10k a month on PPC and SEO outsourcing, you might not want to pay $15,000 a month for analytics data.
Armed with your list of critical information – interview the potential vendors
When you interview the vendors, do not forget the most critical information to your company. The vendors will show you interesting features that you may have not considered. Every time you see it, don’t be overly impressed and think that you can’t live without that data.
For every feature you did not consider, ask yourself, “Will we use this to make changes to our marketing or website?” If yes, then follow up with “how much will knowing that information affect our bottom line?”
If a new feature costs an additional $5,000 per month, and it’s ‘interesting information’ but not ‘actionable information’, then do you really want to pay for it?
Don’t Get Buried in Data
Any analytics program can bury you in data. You could see what browser resolutions are being used in Singapore when the user has java installed but does not have flash installed. If you receive one visitor a month from Singapore, is that useful data? Is the data even useful to begin with if you had ten thousands a month from Singapore?
There are times you will look at analytics and say, “That’s interesting.”
Interesting is not always actionable. Too many ‘interestings’ will cause you to lose an entire afternoon without making a single decision.
Free Isn’t Always Best – But the Price is Nice
Google analytics is a good analytics program; but it doesn’t have the data everyone needs.
If you need real time stats about your website because you make changes to your homepage throughout the day to direct visitors to the hottest selling items – Google analytics can’t help you.
If you need data warehousing capabilities so you can segment traffic sources from any timeframe based upon their conversion funnels – Google Analytics can’t help.
If you do not have an analytics program, Google analytics is a great place. For many companies, Google Analytics has everything they need. However, you won’t know that until you ask your team first.
Start with your team – they should know what they need to make decisions.
Ask the most important analytics questions that exist:
- What do you need to know to get your job done?
- Is that information actionable?
- What is it worth to our company to pay for this information?
Then ask the vendor, can you provide that information, and how much will it cost.
Making decisions based upon solid analytics data can increase your profits dramatically.
Paying for data you don’t use is a drain on your bank account.
Analytics is just a tool. The way the tool is used is what matters.
When you hire good talent, make sure they have the data they need to help your company succeed.