Don't Waste Time Solving the Wrong Problem

Imagine you manage an e-commerce website, and your sales are down by 20%. What should you do? How do you know what the problem is? Or even if there is a problem?

Web analytics!

There's a big difference between lower sales because traffic volume itself has decreased, and lower sales due to a declining conversion rate. What might be an effective course of action for one situation wouldn't help at all with the other.

And if it's just a normal seasonal fluctuation, there might not even be a problem at all.

Without analysis, you could waste a lot of time trying to solve the wrong problem — or trying to solve a problem that doesn't exist. And if you're anything like me, you don't have a lot of time to waste.

There are a lot of very sophisticated (and often very pricy) solutions for full-blown web analytics. But there are inexpensive (yes, even free) ways you can get beyond simple “hit counting” and start working with real actionable information.

An excellent first step if you haven't done so already is to sign up for Google Analytics and install the code on your website. It's free, and it's based on the high-end Urchin software (yet another of Google's many purchases over the years).

What kind of “actionable information” can you get?

Well, for instance, wouldn't it be nice to know not only which sites are sending traffic to your pages, but which of those referring sites sends you the best-converting traffic? Set up Google Analytics appropriately, and you will know. And once you know that, you have a better idea of what sorts of sites to seek out for useful linking opportunities.

How about being able to see which search phrases send you the most traffic from the free search engine listings, and which of that converts best? Armed with that information, you may have a better idea of what kind of search phrases your best potential customers are using. You can do a better job of optimizing your site to attract the audience you want.

And, of course, by analyzing traffic trends and conversion rates over time you can tell if that 20% drop in sales is due to declining conversions, a drop in traffic or if it's just the usual summertime holiday lull.

So what are you waiting for? Go forth an analyze!