Web analytics is not all about numbers, in fact, numbers do not mean anything without context. Yes, numbers don’t mean it all. Let’s go back to basics and let’s take a look at the very well known business statement: your revenue does not mean anything, your profit does. Revenue does not mean anything because your revenue can be as high as you want it to be but it will never be an indication of how much money you are truly making. Having said that, your profit in itself and taken out of context is not as useless as your revenue but can be a useless number when taken out of context.
If your profit is £100K, is it an indication of how healthy your company is? Not at all. How does £100k compare to last month? To last year? Let’s say that it is actually up 2% YoY. Ok, things are starting to look positive. But hang on, the country’s GDP in which your company operates grew by 8% YoY and one of your competitor’s profit grew by 6% YoY. Does your £100K profit (up 2%YoY) look as healthy now? Not anymore I’m afraid…
I hope that this illustrated how important it is to look at numbers with a lot of context. As a web analyst, to get context, you can’t rely on just your web analytics solution. The good news is that there are tools that can give you just that. There are two tools I like using a lot: Google Insights for Search and Hitwise. Google Insights for Search is good as it gives you for FREE volumes indication of what the world has been searching for. It won’t give you actual volume numbers, Google actually normalizes the data and presents it on a scale from 0-100. Based on my experience, I have had discrepancy issues with the tool where I extracted data for a particular week on one day, came back the next day, extracted the exact same data for the exact same week and the results were different to an extent that meant I could not use the data anymore. So, I would bear that in mind and not take the numbers literally but look at trends instead. I mainly use the tool for Year on Year and Week on Week comparison to try and spot demand shifts.
The other tool I really really love is Hitwise. No, the two “really” in a row are not a mistake but a true statement of how I feel about this tool. Amongst so many other things it gives you an indication of your site traffic for a given market, or a “category” and for a set of competitors. Let me describe this a bit more: unlike a tool like Comscore for example,( great tool by the way!) Hitwise will not actually give you actual traffic numbers (at least it did not do this in 2009) but it will give you your site traffic market share as you can see on the graph I created below. For the purpose of this exercise, let’s say that you work in the automotive industry and that you are the web analyst for brand B. You are interested in knowing how your brand has been performing against brand A and C over the past few weeks.
This graph is giving you a really good view of what has been happening in your market over the past few weeks. Something happened with brand A as its market share has increased over the weeks and it is now outperforming your brand! What have they been up to? Have they launched a massive TV campaign,? Have they gone viral on the web? Have they just launched a car which makes coffee and croissants in the morning? You guessed it, it could be anything but at least you now know that they are up to something and this could be one of the reasons why you have been getting slightly less traffic than usual over the past few weeks. Actually, one of the smart things about Hitwise is that when there is a sudden increase or decrease in market share, the tool will highlight for you in the graph major events that could have had something to do with it.
Using tools like this in conjunction with your web analytics solution can help build a better picture of the “WHY” as opposed to just the boring “WHAT”. Web analytics is complex in a sense that it requires merging different data sources together to try and make sense of what is occurring on your site on a given date. The tools described above are good at providing you with supply/competition and demand information which is a big step forward but there are so many other factors to be taken into account which can also have a major impact on you site performance. I will be talking about these in my next article so keep an eye on the blog!
Thanks for reading, I hope it was interesting and useful.