There are several weighty books on Web analytics. They’re great reads — if you have the time. But what about busy executives? I’m often asked, “At a high level, what should a CMO know about Web analytics and the value these solutions bring to the organization?”
This column will map out what I believe are the five critical things every CMO (and thus, everyone who works with him) needs to know about Web analytics.
Then, over the next five columns, I’ll dive deeper into each topic to provide more detail and street-tested advice. Think of it as the executive crash course on Web analytics.
After this six-part series, you’ll be able to hold your own, challenge your team, and ensure your organization is heading in the right direction.
The Vendor Landscape Just Changed (Dramatically)
Google’s recent announcement that it’ll offer free Web analytics to the world just changed the vendor landscape. See my fellow columnist Jason Burby’s “Welcome to the Party, Google” for more on the pros and cons of that news. Web analytics as a technology, for all intents and purposes, just became a commodity. One Google believes should be free and unlimited to those who spend their ever-growing online marketing dollars within the Google AdWords program (which is just about every marketing organization I’ve ever met).
What does this mean to a marketing executive? After the dust settles, the marketplace will focus more on the consulting services, training, and expertise necessary for marketing organizations to realize the full value of whichever technology they choose. In other words, it’s not about the tools, it’s about how you use the tools to measure, manage, and optimize your results.
Data Is Data Is Data
Rarely do I see a client who doesn’t have enough data. It’s everywhere. We’re overwhelmed with it. The most sophisticated Web analytics tools today now give you the flexibility to configure millions of reports. But who needs that many? While the tools get richer with features, the majority of marketing organizations look to simplify their analysis around specific, actionable objectives and key metrics. Only in the hands of a seasoned business analyst, whether in-house or outsourced, will you reap the benefits of the deeper custom ad-hoc analysis capabilities that the Web analytics tools provide.
Don’t worry about the data. Worry about the key metrics that are true performance indicators and that will fuel your team to make their next (smart) decisions.
Establish Your Scorecard Now
Don’t wait any longer. Make this a priority and get one built. Learn from it, and evolve it. The scorecard doesn’t have to be complicated. In fact, it shouldn’t be. Start by asking yourself and your team just two questions:
- What’s the number one marketing objective of our Web site?
- What are the top five metrics that will measure the performance of that goal?
That’s it. Don’t allow yourself to slide into data overload and the subsequent anxiety that comes with it. Many organizations fall into the trap of trying to report on too many things at once. They don’t summarize their performance around a few key metrics that can be managed in a monthly or quarterly scorecard. Bringing the team together around a single, performance-driven scorecard will pay huge dividends. I’ve seen it happen time and again.
Breed the ROI Mindset
You want your team to be more accountable. But how do you do that? It requires a paradigm shift in how marketing organizations work, think, and act. As the leader of your organization, you must champion this change. Here are two simple yet powerful things you can implement immediately to encourage this shift:
- Hold weekly results meetings to discuss performance metrics. Discuss performance as often as you brainstorm new campaign ideas.
- Build key metrics into your employees’ reviews and compensation plans. There’s no faster way to raise the bar on accountability.
Optimization Is the Next Wave
Leading marketing organizations will align 5 to 10 percent of their budgets to optimization in 2006. Specifically, they’ll utilize the Web’s strength as the ultimate experiment platform, where all the ingredients come together — measurement, creative, segmentation, testing, and targeting — to prove and improve marketing’s contribution to the overall business. What are you budgeting for optimization next year? Time to reevaluate your spend if optimization wasn’t on your radar.
Questions, comments, a story to share? E-mail me. Let me know what I missed or your insights on one of these five topics for the follow-up columns in this series. I may include your story in a future column.
Vote for your favorite product or campaign for the 2006 ClickZ Marketing Excellence Awards, October 30 through close of business (5 pm EST) on November 8. Winners will be announced on November 13.
Shane is off this week. Today’s column ran earlier on ClickZ. Check out the rest of the series here.
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