Understanding Small Business Web Analytics

By Julie Knudson | Posted March 18, 2015

You can find a slew of powerful Web analytics tools that you can use to see how well your small business website, social media feeds, email blasts and pay-per-click ad campaigns are performing. But those tools won't help much unless you understand which numbers matter most and what they mean.

Sifting Through a Forest of Business Metrics

The data points that are important to your business may be worthless to another company, and vice versa. Figuring out the numbers that matter most for you takes a bit of legwork. "The first thing small business owners should do before looking at any data analytics program is to "get really clear on their goals and objectives," says Philippa Gamse, president of Websites that Win International and author of 42 Rules for a Web Presence that Wins.

Businesses should typically have a major goal—like generating leads if you're a service business, or selling products if you're a retailer—along with any number of smaller or micro goals. "A micro goal, for example, could be getting people to sign up for your email list, even if they don't fulfill your primary goal," Gamse explains.

Brian Gatti, partner at marketing firm Inspire Business Concepts, says that defining your objectives helps to put Web analytics into perspective. "Goals allow you to understand the actual outcomes of the activities on your website," he says. By knowing what you want to achieve, the metrics offered up by your analytic platform can actually mean something.

Web analytics for small business

"Let's say your bounce rate is 60 percent," Gatti suggests. "Is that good or bad? The problem is that I don't know, because I don't know what 60 percent results in for your business." Companies that operate seasonally or that focus on a very specific region, for example, may be perfectly happy with a high bounce rate because they know through their analysis that some of those visitors are simply outside their target audience.

What Do Analytics Numbers Really Mean?

Once you tie your company's goals into the analytics platform, you can delve deeper into the metrics and what they actually signify. Using that same 60 percent bounce rate, Gatti says a more granular analysis may yield actionable data.

"If the people that came to the site through search [engines] last month had a seven percent conversion rate and a 60 percent bounce rate, and social [media] traffic had a 10 percent conversion rate and maybe a 50 percent bounce rate, that tells me there's something different about the type of people coming in from social versus organic search," says Gatti.

A small business operator could then examine the route the two different groups take to the website—does one arrive on a dedicated landing page while the other gets sent to the standard home page? Now you can determine if one channel needs to be more action oriented.

Assigning dollar value to specific actions within the analytics program can also help business owners zero in on how their metrics measure up. It's a useful strategy no matter what type of service or product you provide.

"You can assign some sort of value to every single outcome you've defined," says Gamse. "Those will all show up in the analytic reports." Now you can more easily spot trends—which are often more useful than looking at individual sets of analytic data—and understand how they're affecting your bottom line.

For example, site visitors coming from Facebook may be very excited about your product (and your metrics may show you there are a lot of them), but by looking at your analytics you may discover they aren't buying anything. "However, the people who click through your email campaign promoting your newest offerings may result in a lot of conversions," Gamse explains. By evaluating the dollar values associated with various outcomes, you'll know the email campaign was successful, and your Facebook presence needs some work.

A Warning About Analytic Obsession

Checking your online performance numbers can become an all-consuming task. Before you find yourself compulsively evaluating your metrics, go back to those goals you established earlier and see how often it actually makes sense to scrutinize your analytic data.

"If you launched a new site on Monday, you might come back in two weeks, or in a week, and look at your analytics to make sure things look right and that you know your site is still getting traffic," Gatti says. But when your site is stable and your various marketing strategies are chugging along, you can space your analysis out a bit.

"Typically, once every month is a good schedule, because day-by-day data changes are often not valuable," Gatti says. "Assuming things are running on a normal operation basis, that's a good guide point."

There's another reason that constantly stressing about your metrics may be unproductive: the numbers aren't always as precise and scientific as you want them to be. "There's no such thing as completely accurate analytics data because of the way analytics data is collected," Gamse explains.

There aren't any standards between the different analytics programs, and each platform may employ its own protocols for collecting information. In addition, the methodology sometimes doesn't track things the way you expect. For example, if someone visits your site and reads your blog or watches your latest video, they could still be counted as a bounce.

"If everything visitors look at is on one page, even though they engaged with your content and they potentially did something good, they'll show as a bounce because a bounce is defined as somebody who looks at one page and walks away," says Gamse. It's one more reason that trends over time are typically more meaningful than trying to examine just one piece of data.

Julie Knudson is a freelance writer whose articles have appeared in technology magazines including BizTech, Processor, and For The Record. She has covered technology issues for publications in other industries, from foodservice to insurance, and she also writes a recurring column in Integrated Systems Contractor magazine.

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