Actionable Analytics Strategy

This article was originally posted on Moz.com.

Many websites have Google Analytics setup, but the majority are not making the most use of these resources. Often, analytics is an afterthought or is dismissed as merely a way of tracking the number of visitors on a given day. But there is so much more actionable data to be had with a little time and forethought.

In this post, I am going to talk a bit about analytics strategy and then provide examples of actionable data that can be tracked and how it might be useful.

Strategy

At a very high level, start by considering the goals of your site and how those map to your analytics tracking. Most eCommerce and Software as a Service (SaaS) businesses, for example, want to generate a purchase transaction. Services businesses such as consultancies may be looking to generate higher funnel leads that will eventually lead to contract for service offline, at a later time. Still others, such as news content sites, might define a goal as keeping a user on the site for a minimum amount of time or having them return a specified number of times within a month. Whatever your goals are, it is imperative to define those clearly – ideally before you even create your website, but certainly before setting up an analytics campaign.

Each of the above goals is possible to track using custom events, goals, events, and funnel tracking in Google Analytics. There’s even a way to setup custom widgets on the dashboard and have reports and alerts emailed to you on a schedule as well, making it easier than ever to access highly meaningful performance metrics. There really is no excuse to still be using a tool as powerful as Google Analytics to merely track your page views day-to-day.

Define Your Goals

What should we be tracking? Let’s take an eCommerce site as an example, since it has the most sophisticated and well-defined conversion funnel, and we’ll demonstrate the Key Performance Indicators (KPIs) at each major step of the funnel that we might consider tracking. This should give a good idea of what’s possible and get the creative juices flowing a bit. There are three major steps to the typical eCommerce funnel with an optional fourth step. Let’s walk through each one:

i. Acquisition

funnelWe start by looking at how traffic was acquired. How were users sent to your website and from where? Although you may never attain 100% visibility, you’d be surprised just how much visibility you can achieve. You probably already know this through the standard analytics reports: that you can see keywords that were searched and on which search engine. Google also makes it very easy to integrate AdWords data to see exactly which AdWords campaigns are generating traffic and which are converting. Google also owns Feedburner, which provides yet another trackable channel for which you can directly attribute traffic.

Tagging is possible for anything outside of the Google-sphere, making it possible to add (utm) tags to the querystring of any URL you embed into an email campaign, social campaign, or banner marketing campaign. For many people, that’s the point where the light really goes on, realizing that you can tag and thus achieve almost complete visibility of traffic sourcing, and factor all of this into your integrated analytics campaigns.

An example of using UTM tags to track external click events:

http://www.site.com/myproduct/?utm_source=yahoo&utm_medium=300×250-banner&utm_campaign=myproduct

With all of these tactical tracking opportunities in mind, imagine the possibilities. Here are just a few examples of valuable KPI data points you might consider tracking as part of acquisition:

  • Organic Search (SEO)
  • Paid Search Marketing (SEM)
  • Social Campaigns
  • Banner Campaigns
  • Links from External Sites
  • Links from Online Videos
  • Email Recipients
  • RSS Subscribers

ii. Engagement

Once you’ve got the attention of your users, are you effectively driving that traffic toward your funnel or toward micro-conversion events that help to keep them engaged? Even if the visitor does not purchase something today, it can still be extremely useful to capture an email address, get them to subscribe to an RSS feed, or any number of other activities that will keep the communication channels open and continue to educate and qualify them in preparation for a later purchase. This is particularly true of larger purchases or services, which require longer time for transactions to mature.

To begin thinking of KPI data points in the engagement segment of the funnel, consider what sort of user activities you could be implementing and the corresponding micro-conversion goals you could be setting. This may also help you realize that you could be doing more to engage your users. Here are a few examples of good engagement goals to track:

  • Account signup
  • Email signup
  • RSS subscription
  • Saving product to wishlists
  • Adding item(s) to cart
  • Contributing product ratings or reviews
  • Watching video
  • Content interactions (e.g. photo zoom, faceted search attributes, etc.)

iii. Conversion

You’ve made it from acquiring to engaging, and now you’re finally converting that prospect into a paying customer. This is the point at which you’re finally able to attribute cost and value to all of your efforts and begin making some decisions.

If you’re spending money on paid search campaigns, you can see the precise value of each ad campaign, if you’ve integrated conversion tracking. You’ll also be able to see percentage of conversions for other non-integrated channels such as SEO, social, and banner re-targeting. Plus, other details such as average order value and average time to complete a purchase, and you can segment those macro statics by channel to derive insights such as paid search converts with better velocity than social.

The KPIs to consider tracking at this funnel step are:

  • Return on ad spend (ROAS)
  • Return on investment (SEO, Social)
  • Revenue
  • Average order value
  • Average time to complete order
  • Average visits before conversion

* Consider segmenting all of these KPIs by ad channel

iv. Loyalty

All of the above analysis can be very valuable, but is a bit myopic if take in isolation, particularly if you have return visitors or a more sophisticated sales and marketing operation that involves multiple touches prior to conversion.

Consider the more complex scenario of a prospect who visits your site, then sees retargeted banners on other sites (reminding them of you), so they sign up for your newsletter and eventually convert into a customer. And what if they come back a second or third time thereafter and purchase again. How do you attribute the sales? Does it all get attributed back to the ‘first touch’ interaction with one of your ads?

The new version of Google Analytics (v5) introduces the idea of a multi-channel funnel, which helps to address this issue. With a series of new reports, you can finally see which touch triggered the transaction, but you can also see the path and which other touch points may have assisted with that transaction. This can go a long way toward helping to understand the less tangible value of the early-stage-funnel ‘assist’ campaigns. For example, the social channel has notoriously low direct conversion attribution… But with multi-channel attribution, you can finally begin to see its role in setting up other activities later down the funnel to trigger a transaction.

Multi Channel

Putting it all together

Hopefully, you are seeing the sort of user behavior and ad campaign performance insights you can mine from Google Analytics, if you take the time to define a strategy and properly implement the tracking and reporting. And that really is the key take away: analytics is a powerful tool that will provide substantial actionable data and enable you to make much smarter marketing budget decisions; but it requires clarity for your goals and how you drive traffic and engage your users. Without that clarity, you do not have a road map to setup a meaningful analytics campaign. Clarity and discipline is where many businesses get stuck and why so few practice meaningful analytics, outside of the major enterprise. But if you have clarity around your traffic generation and engagement activities and goals, you can generate highly informative and actionable data to super charge your marketing efforts, and that is a real competitive advantage.

Website Optimization Tips

Optimizing a site can mean many things.  If you’re an eCommerce site, probably means optimizing your landing page, hiding your navigation so as not to distract, and pushing visitors toward the goal of a transaction receipt page.  For small business and service professionals, it may mean getting someone to fill out a form.  Or if you’re a publishing site, it very well might mean something nearly opposite of those two focused goals – perhaps you actually do want visitors to traverse your navigation, discover and engage with your content or community.  No matter how you describe it though, these things all have one thought in common:  you’re looking to maximize the value of each visitor to your site.

Although this practice is typically referred to as Website Optimization, Landing Page Optimization (LPO) or Conversion Rate Optimization (CRO), it is part of much broader schools of thought.  Many universities now offer interdisciplinary programs called Human Computer Interaction (HCI) that combine the study of Psychology and Information Systems, to better understand how to create systems that do a better job of servicing and assisting the humans that the systems were built for.  Usability and User Experience are two more common terms now used in design circles, to describe how to improve a user’s interaction with a system or website.  In many ways, landing page optimization and conversion optimization are applied marketing concepts, as much as Usability and User Experience are applied design concepts; but they’re all drawing up HCI which simply seeks to create better interfaces that accomplish the goals of the system. For the purposes of this blog post, I’m focusing on the marketing prerogative, but many of these thoughts can be applied to overall system design and usability as well.

Improving Efficacy
So how does one maximize value from their visitor? For the purposes of this discussion, let’s assume we’re talking about the easy to understand and quantify, eCommerce model.  With eCommerce, there’s typically a large spend on PPC and that spend is usually in pursuit of directly-quantifiable direct sales; not long-term fuzzier metric brand building. So our goal in this case would be to get users to our site for $1 and get as many of those visitors to buy something as possible, to increase average profits above the dollar we spent to acquire their attention.

Website Optimization
We’ll ignore the efficacy of the ads themselves for this conversion and focus purely on what happens after they arrive at the site.  Onsite, there are really two things that matter:

  • Focusing attention in the direction we want them to go.
  • Reinforcing trust and removing doubt and fear.
  • Keep attention focused and directed at the goal line (the receipt page).

If we keep those strategic goals in mind, the tactical implementation is relatively straight forward at a high level.  Obvious optimizations would be:

  • Remove the navigation bar on the landing page
  • Use very large submit buttons that are hard to miss
  • Use simple bullet points for details, not long-form text
  • Don’t present too many choices; match exactly the one product they searched for.
  • Use a headline that excites the user.
  • Use trust signals such as testimonials or credential logos on landing and checkout pages.
  • Minimize extra steps that could be hurdles to checkout such as the always-favorite required membership signup.
  • Remove barriers such the form that goes blank and requires refill if one piece of required information is wrong.
  • Don’t ask for more information checkout than is absolutely necessary.
  • For God sake, do NOT use Captchas!

Beyond those basics, there are a number of more subtle opportunities for optimization that simply require a “feel for the art” of it all, and proper domain knowledge, to match the culture of your users.  Catching their attention is key but authenticity and trust are also very important and cannot be sacrificed for a cheap thrill, or they’re not going to give you their credit card number.

Tactics that might work well would include using a larger checkout button with appropriate messaging.  Perhaps something exciting such as “Check it Out!” works for an entertainment product but a move conservative “Get Started” is more appropriate for insurance or financial institutions.  Color choices, images and titles work the same way.  Focus on finding a way to grab attention and infuse emotional excite, without compromising authenticity or trust.

Testing Methodology
As with any advice, there are many half truths in optimization.  What works well for many sites may not work for yours.  A lot of this comes down to culture and the issues f authenticity and trust I mentioned above.  For this reason, you may start with certain known principles as described above and broader usability heuristics, but the only way to truly know what works best for your own audience, is to test.

Testing in fact, is at the basis of most sophisticated online marketing operations today. We should start with a humility that we never absolutely know truth, we can only approximate it, and should always seek to evaluate truth through objective and empirical evaluation.  As such, most online markets today user an iterative approach to their online marketing and optimization strategies.  Continual testing and revision is baked into the on-going process.

To test your overall conversion funnel, you just need to setup goals and funnels in your analytics tools to be able to track and observe where bottlenecks are and results of changes. The efficacy of a specific landing page however, is better instrumented with a tool specifically designed to track changes of that one page, and track the goals against those changes.  There are tools such as Unbounce, Optimizely, and the free Google Website Optimizer (WSO) for that; WSO optimizer in particular is handy due to its one-click Google Analytics integration.

There are two types of tests that you might consider running for landing page optimization – an A/B test, or a Multivariate test.  An A/B test compares two or more separate pages, to determine which is more effective. This is a simple test to setup, requires less traffic, and is great for comparing entirely different versions of page layout.  If you instead want to focus on testing more subtle changes within a page such as title messaging, or button color, or featured image, a multivariate test would be appropriate.

A/B Testing
Using a tool such as Google Website Optimizer (WSO), you’d either setup redirection for the randomly served variants of yourA/B test, or you’d embed a few JavaScript hooks so that you can manage your variations from the WSO tool, if running a multivariate test.  Once setup, just wait for enough sample data to collect and let WSO do its thing.  Over time, you’ll see a percent-likely determination for which page is more successful. For example, “This page is 95% likely to outperform”.  Once you reach around 90-95%, WSO will determine the variant to be a “highly significant” improvement.  From there, you’ve confirmed which variant is more effective and can make your changes, as well as consider the next round of tests based on your findings.  This process can be repeated enlogica as you focus more and more on exactly what works.

For anyone new to optimization, I cannot stress enough, how important these methods are; you’re likely leaving a substantial amount of money on the table.  If you’ve never thought about optimization before, its quite likely that you can increase your Return on Ad Spend (ROAS) by 100% or more. I personally have had experiences in which small changes such as making a checkout but big, green and changing the messaging on it, with a single test, increased conversions by almost 40%.  So, while this form of methodical and detail-oriented optimization may not be the most sexy part of running your online business, it could easily be one of your most important!