Digital Analytics is the study of data about your company’s website that has been collected from a variety of sources and enables you to make decisions about your site based on solid evidence rather than just a “gut feeling”. Is this important? You bet it is. Armed with the right information you can make decisions about which avenues of opportunity are likely to result in the highest reward for your company.
Why has Digital Analytics become so important?
There are three factors that have dramatically changed not just the digital economy but the economy as a whole.
- The Internet – Twenty years ago there was no such thing as ecommerce, the web was in its infancy and there were few businesses online. Today we can search for products, reads reviews and get recommendations from our friends and make purchases all with a few clicks.
- Smartphones – smartphones keep us connected 24 hours a day, seven days a week. They allow us to compare prices even when we are in a physical store.
- Affordable Big Data – With increases in computing power we are able to collect, store and analyse an unprecedented amount of data.
The first two items in the above list have changed the way that many of us now shop. The internet is often the starting and end points of our purchasing process. This generates huge amounts of data and with affordable big data now being provided it means that you have the ability to analyse more data than ever before.
In order to take advantage of these new opportunities you need to ensure that you have a solid infrastructure to collect and analyse your data, without it making decisions about your online marketing efforts will likely be very overwhelming.
Customers and the Customer Funnel
In the past the buying process has been visualised as a funnel known as the Customer Funnel. The traditional customer funnel has distinct stages. Each stage in the process would generally have fewer users that the preceding stage.
Awareness > Acquisition > Engagement > Conversion > Retention
Today customers can start their journey at any point in the decision path. By analysing your customers you can make plans for where within the buying process they will start their journey and then work out what messages they will need to hear from you in order to achieve your eventual goal.
Two Types of Data
There are two types of data that you can analyse, quantitative data and qualitative data. There has always been a lot of data about a website. This is considered to be quantitative data. It can tell you information such as how many visitors your website has had, how many pages they looked at, what they do on your site etc. With recent increases in big data analysis and technology in general it is possible to track mobile apps, games consoles and web enabled devices as well as your website. This gives you more granular insights into your customer’s activities with your organisation.
Having discovered what users are doing you now need to know why they behave the way that they do and that’s where qualitative data comes in. A good example of this would be the results of a survey that users of your website have completed. In the survey you might ask why they chose your website, if they were able to complete a specific goal (a sale or completing a contact form might be examples) and what helped or hindered them in completing the goal. Armed with this information you can then look at ways to improve your site based not on your own view but on the real life experiences of your own customers.
It is one thing to collect data but you also need to understand how to interpret that data so that you gain the most from it. To do this you will need to have a clear measurement strategy. Your measurement strategy will depend upon what the business objectives of your website are. If you run an ecommerce website then you will be most interested in the number of sales that your site generates. While if you have a content website then you will have most interest in the number of visitors to your site.
With any business objective on your websites there are key actions that will tie back to that objective. An action that indicates that an action has been fully met is termed a macro conversion. An example of a macro conversion is a user making a purchase on an ecommerce website. There are other actions that a user might take on your website that are an indicator that while they have not completed the required task completely they are moving towards that completion. These are called micro conversions and examples of them might include signing up for a newsletter or looking at a product review page.
It is the analysis of both micro and macro conversions that will help you to understand what achieves the best outcomes for your business.
Digital analytics gives you the opportunity to improve your business repeatedly. You should look at the available data, analyse it, make changes and measure those changes and then start the whole process over again. Do not rest on your laurels, instead look continuously for the next way that you can improve your online marketing.
Digital analytics is changing the ways that businesses interact with their customers. If you are interested in learning how digital analytics could improve your online marketing then call Michael Walmsley on 0800 779 7829.