Web Analytics: What’s Worth Paying For?

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Overwhelmed with data, many companies are cutting through the noise by seeking Web analytics that enable them to do a better job of viewing—and acting upon—multichannel relationships.

“It’s the Holy Grail of Web analytics,” observes Tim Bourgeois, a partner at East Coast Catalyst, a Boston-based digital strategy management consulting firm.

“Companies need help in figuring out the relationship among, say, the $10 million they are spending on advertising, the $3 million on offline events, the $1 million on search marketing, the $1 million on display advertising, and the $1 million on email marketing,” he explains. “And right now, there’s a ton of activity going on at the analytics companies to make that happen.”

At suppliers like Coremetrics, an IBM company, and comScore (which acquired Nedstat in September)—both of which charge for their software and services (as opposed to Google Analytics and Yahoo Web Analytics, which do not)—most of the focus is on the enterprise-level customer.

“My clients range from big, recognizable companies like Comcast and Black & Decker all the way down to two-person consulting firms,” says Bourgeois, “and it’s been my experience that, at the enterprise level, most of the companies rely on enterprise-class ‘for purchase’ applications—like those of Coremetrics and comScore—to govern most of their analytics activities.”

Indeed, Coremetrics recently released two Web analytics software products—Coremetrics Social and Coremetrics Lifecycle. The former, available as part of the Coremetrics Continuous Optimization Platform, lets users measure the ROI of social media efforts with social media and analytics data in one interface. The latter, which comes as a feature module within the Explore Analytics Platform, is said to provide visibility into unique, event-driven customer segments that equip marketers with tools for cultivating high-value customers.

“Customers want to know, for example, whether their investments in social media marketing are yielding results,” observes John Squire, chief strategy officer. “It’s not about the number of ‘fans’ your brand or company has; it’s about whether those fans are actually buying what you’re offering. And are you analyzing their interactions with you in such a way as to drive programs that get better and more targeted over time? So all of our products across the board are designed to help marketing teams design, measure, and optimize their marketing programs and their spend based on factual data about how their target audiences are responding to programs and campaigns.”

While analytics has always been about measuring the impact of marketing programs on the bottom line, Squire says he is now seeing “a definite and pronounced urgency around taking the data and doing something specific with it—there’s a trend toward turning analytics insights into actions.”

The reason, Squire says, is that marketing teams and chief marketing officers are being held increasingly accountable to prove that they’re driving revenue—and that for every dollar they spend, they bring an increasing amount of dollars to the organization.

“That means that analytics can no longer be about simply gathering data in a somewhat passive or retrospective manner, but about using that data to make impactful decisions about the business,” Squire notes. Take the huge growth in mobile use. “Many marketers are not only investing in sites that are optimized for a rich mobile experience, but they’re also investing in the analytics to measure mobile’s contribution to the bottom line. There’s a trend toward relevant, targeted marketing—from email campaigns to display ads and everything in between. Marketers are using analytics data to drive these very specific, targeted-to-you programs.”

At comScore, where the core customers are large Web publishers, the company’s Digital Analytix product is said to have a few advantages over its competitors, according to Jodi McDermott, senior director of product management. First, she says, the data is not aggregated, which frees comScore’s clients to manipulate the data and run reports according to their specialized needs.

“We’ve heard from many clients who are unhappy with current solutions… that the lack of flexibility in running reports constrains their ability to get the insights they’re looking for,” she notes.

Second, the product can incorporate audience demographic profiling, which is “another unique capability that unleashes a new layer of insight from Web analytics data,” McDermott says.

She explains that Digital Analytix—which is offered as a software-as-a-service (SaaS) model, in which all data is hosted by comScore—allows for the ingestion of any type of structured data source, including:

•    Web site measurement of pages. This covers events such as click-ins, click-outs, and PDF downloads, as well as value events, like conversions, orders, and form submissions.

•    Streaming analysis. The solution integrates directly into any player and allows for analysis of all elements of a user’s interaction with both audio and video content. The product also monitors the overall health of the player in that comScore collects technical measurements on the behavior of the streaming environment itself.

•    Mobile measurement. Digital Analytix measures both how mobile devices are accessing content on the customer’s site and the ability to collect data for mobile-optimized Web pages.

•    Application measurement. The solution allows customers to instrument measurements for applications on iOS, Android, BlackBerry, and almost any other platform that enables applications.

•    Back office data. Digital Analytix can ingest data from any other system in which there is a common key via Data Merge or Data Lookup.

But Coremetrics and comScore both offer paid solutions with a higher level of analysis that not every customer requires, East Coast Catalyst’s Bourgeois says.

“If, for example, you want to track the fact that someone went to NewYorkTimes.com and read an article about brown shoes, then three days later they clicked on an ad for brown shoes, and then a week later they went on Zappos.com and bought a pair of brown shoes, that takes a genuinely enterprise-level solution with a certain sophistication that not everyone needs.

“In that case,” Bourgeois adds, “the ‘go to’ analytics supplier for a company that’s just starting to get serious about its digital operations is Google Analytics. Yes, I’ve seen Google Analytics used at larger companies at the enterprise level, but it’s been used primarily at a business unit or product level by a product manager who just needs to be able to control his or her environment when it comes to monitoring activity.”

Indeed, Google Analytics—a free product—does not have such features as, for example, the ability to natively link to an attached data warehouse so customers can manipulate their data.

Nonetheless, Google Analytics positions itself as providing just those features that customers actually request to inform their strategic decisions, “not those that far exceed what most marketers want from their analytics tools,” says Phil Mui, group product manager. “I like to use Microsoft Word as an analogy. Most people say that it has so many features that they find they only use about 10 percent of them.”

If customers want or need additional enhancements, Mui adds, “We have a very vibrant extended ecosystem of over 200 worldwide developers who build on top of the Google Analytics system. So, for enterprise customers who need, for example, a data warehouse or linkage to an email system, we have an apps gallery that will more than satisfy those needs.”

This past year, Google Analytics has been experimenting with an approach it calls Google Analytics Intelligence, which features machine learning–based automatic alerts designed to signal to customers what they ought to be paying attention to daily.

“As an example, the Google Store uses Google Analytics Intelligence to make marketing decisions,”  Mui explains. “Recently, its marketing person logged into his account and was alerted to the fact that, on one given day, the number of British visitors from the TechCrunch site suddenly increased by 100 percent compared with what was expected on that date. It turned out that there had been an article on TechCrunch that described a particular product that drew a lot of attention. So the decision was made to create a customized media campaign on TechCrunch and similar sites around that kind of merchandise.

“Think about that,” Mui says. “Among all the countries in the world and among all the referral sites you could possibly visit and among the hundreds of thousands of kinds of merchandise, our system was able to pick out the one specific city, the one specific referral site, and the one specific product—and then tell the marketer that he ought to be paying attention to that incident. That’s what we offer our customers...actionable insight to help them make better decisions.”

Similarly, Yahoo Web Analytics (YWA)—which is based on technology acquired through IndexTools in 2008—is a free solution that is self-described as an “enterprise-level Web analytics solution available to Yahoo customers with managed accounts as an augmentation to their existing services suite.” The exception to this model is the Yahoo Web Analytics Consultant Network, a collection of partner agencies that exclusively supply YWA for free but may charge for their support or consultancy services.

“YWA is highly customizable and allows the customer to track each and every visit and action on a Web property,” says Josh Klahr, senior director of product management for Yahoo’s User Data and Analytics team. “The data collected is unaggregated and near–real time, so that implementation, not just ongoing analysis, is subject to a high degree of clarity and accuracy. Data can be sliced and diced, exported and manipulated, visualized on dashboards, and integrated with merchandising products and categories. It is possible to set up all your email campaigns, affiliate campaigns, internal campaigns, and import impression and cost data from the main search engines to allow a 360-degree view of your Web site’s interaction with targeted visitors.”

The latest addition to YWA is a cross-channel attribution metric, called Assists, to better optimize campaign conversions and campaign budgets.

According to Klahr, a campaign is attributed with an Assist when it contributes to the conversion of another campaign later in the conversion funnel (within 45 days). Assists can be leveraged across multiple campaign channels, such as search, display, social, email, and affiliates, to provide better insight into a campaign’s true attribution value.

“Any worthwhile Web analytics solution must be flexible because every customer is unique and has a unique set of business requirements,” Klahr adds. “To answer these needs, YWA has over 80 out-of-the-box reports and thousands of custom report capabilities.

Customer-specific data may be collected using custom fields, and as many as 50 actions/events may be recorded. Product SKUs and categories may be uploaded, and access to the user interface can be limited to a particular set of reports or all reports for a particular Web site.”

Yahoo automatically provides YWA integration into the big microsites it builds for major client partners. “This is a huge value-add for our clients because they get the necessary reporting for their sites at no additional cost,” Klahr notes.

When deciding between a paid or unpaid analytics solution, it’s important to consider support, Bourgeois says.

“It’s exactly what I tell people when they are considering an open-source content management system,” he says. “Some will say they intend to go with Drupal, which charges zero license fees, and I get the appeal of that. But they’d better make darn sure they have a Drupal expert on-site who understands the system inside and out because they surely won’t be getting any support from Drupal.”

He adds, “Similarly if you are going with a paid analytics solution and spending a few hundred thousand dollars a year in licensing fees, you’re going to get some pretty solid support—which means you don’t have to worry about your application imploding on you. If you go for a free solution, you’d better have an in-house expert on hand. As they say, you get what you pay for.”

Paul Hyman is a freelance writer based in New York. He can be reached at phyman@optonline.net.

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